keesje
Posts: 8752
Joined: Thu Apr 12, 2001 2:08 am

Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 5:14 pm

"If the president of the United States or the Democratic candidate would say, 'I'm going to put the resources of the United States behind this airplane,' it would mean a lot,"

IMO a further sign the governement is winning back over the hailed free market ideology in the US. And its fully supported by the people.

http://seattletimes.nwsource.com/html/businesstechnology/2001574432_boeingjapan21.html

interesting article
"Never mistake motion for action." Ernest Hemingway
 
MITaero
Posts: 485
Joined: Mon Jul 28, 2003 8:00 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 5:23 pm

That is interesting, I didn't know the US and EU had that kind of agreement.

btw, there's an html tag in the middle of the link that's breaking it.
 
keesje
Posts: 8752
Joined: Thu Apr 12, 2001 2:08 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 7:07 pm

Japanese aerospace manufacturers may soon ask the Japanese government to cover a large portion of their research and development costs as suppliers on Boeing's proposed 7E7.

But a more radical proposition will soon emerge in Washington, D.C., where the aerospace industry's chief lobbyist wants the U.S. government to dub the 7E7 "America's Airplane" and align its research and development spending to help Boeing speed the 210-seat airplane to market.

John Douglass, chief executive of the Aerospace Industries Association (AIA), would like the Department of Transportation, the Federal Aviation Administration and the National Aeronautics and Space Administration to publicly commit to assist development of Boeing's next-generation jetliner.

"All of us should line up behind Boeing in getting this plane to market," Douglass said.

Douglass wants no new money for Boeing, but his proposal is bound to intensify the long-running debate over government supports for Boeing and its European rival, Airbus.

News reports in London and Tokyo in recent days said Mitsubishi Heavy Industries, Kawasaki Heavy Industries and Fuji Heavy Industries will ask the Japanese government to give the 7E7 priority status so they can tap state research subsidies and low-interest loans.

Funding requests for Japan's 2004 fiscal budget must be submitted to Japan's Finance Ministry by the end of August.

Boeing said it was not aware of the Japanese manufacturers' plans.

Boeing has also named Alenia Aeronautica of Italy and Vought Aircraft Industries of Dallas as 7E7 airframe suppliers.

"Our partners will fund their own work, and we're not going to dictate how they get their funding," said Yvonne Leach, a Boeing spokeswoman. "Government funding wouldn't be out of the question if that's a path they choose to go down."

Government support would be in keeping with Japan's history with Boeing. The "heavies" built 16 percent of the 767 in the early 1980s and 20 percent of the 777, and received research assistance from Japan's Ministry of International Trade and Industry on each project.

U.S. government support of the 7E7 would be anything but ordinary.

Douglass cautioned that his recommendation is just that. But Douglass is well respected in Washington, D.C., and he regularly shares his views with influential decision-makers in both parties.

Douglass will present his 7E7 advocacy plan to the AIA board of governors at an executive meeting in November. The board will then establish five to 10 policy priorities to push during 2004 elections.

"If the president of the United States or the Democratic candidate would say, 'I'm going to put the resources of the United States behind this airplane,' it would mean a lot," Douglass said.

It would certainly get attention in Toulouse, France, where Boeing's rival, Airbus, is headquartered.

Boeing and Airbus have feuded for years over government supports to lessen the cost of developing new airplanes.

A 1992 bilateral agreement between the U.S. and the European Union permits both manufacturers to receive government loans worth up to one-third of a plane's development costs.

Airbus has received such loans on every airplane it has produced. For the A380, the mammoth 555-seat jet due to enter service in 2006, Airbus has acknowledged it is getting $3.1 billion in government loans and subsidies toward the plane's estimated $10.7 billion development cost.

Boeing executives and U.S. government officials say privately Airbus is getting even more.

Boeing does not use such loans. Instead, it receives indirect support in the form of Department of Defense and NASA contracts with trickle-down benefits for its commercial-airplane program.

Airbus contends such contracts are far more beneficial to Boeing than any government loans it receives.

Douglass believes the U.S. needs to change tactics. Airbus has been one of the European Union's great success stories, he said, so European governments will not do anything to weaken Airbus, such as reducing subsidies.

Douglass does not want new government funding for the 7E7. Rather, he wants NASA, the FAA and other agencies to coordinate with Boeing to help the 7E7 succeed.

"Let's do what America does best," Douglass said. "Let's support our own program."

Boeing did not return a call seeking comment on Douglass's proposal
"Never mistake motion for action." Ernest Hemingway
 
MD-11 forever
Posts: 550
Joined: Wed Mar 14, 2001 12:15 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 10:19 pm

"Douglass does not want new government funding for the 7E7. Rather, he wants NASA, the FAA and other agencies to coordinate with Boeing to help the 7E7 succeed. "

I just wonder what "help" the FAA could offer in order to help the 7E7 program to succeed...... Maybe "adjust" the requirements?

""Our partners will fund their own work, and we're not going to dictate how they get their funding," said Yvonne Leach, a Boeing spokeswoman. "Government funding wouldn't be out of the question if that's a path they choose to go down.""

Here in Switzerland we say "If two people do the same, it's never the same". I guess this seems to be a classical double standard. If Airbus suppliers ask for low interest loans it's unfair competition, but id Boeing suppliers do it, it's "a path they choose to go down".

Makes one think a bit......

Cheers, Thomas
 
CX747
Posts: 5576
Joined: Tue May 18, 1999 2:54 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 10:54 pm

Whats happening here is that the United States or certain members of the aviatoin community are calling for a better support system for Boeing. I am an American and I do believe in a free market without government interdiction BUT when the playing field is being tilted as far as it is for Airbus, one needs to rethink the approach.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 10:59 pm

Given the Rasputin-like nature of Airbus, what Douglass is saying makes some sense. No matter how economically unsuccessful an airplane Airbus ever built, it was never in any danger of having to leave the business like Lockheed or MD.

If Boeing messes up the 7E7, then it is likely 'game over' for large transport airplane manufacturing in the United States and the EU will have successfully bought the entire industry and the jobs that go along with it. That is something policy makers in this country should take note of.

 
CX747
Posts: 5576
Joined: Tue May 18, 1999 2:54 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:03 pm

That is why in my opinion, this "proposal" should go through. If we look at the major aircraft manufacturers today 1. Boeing 2. Airbus 3. Canadair 4. Embraer 3 out of 4 receive major government subsidies. I'm sure that the arguement regarding Boeing's military sales etc will be brought up, but as stated in the article, that has little to no affect on commercial aircraft sales. Also, Boeing is providing a service for the money the Defense Department pays it. Airbus does not.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:14 pm

N79969

No matter how economically unsuccessful an airplane Airbus ever built, it was never in any danger of having to leave the business like Lockheed or MD.

Do you really believe that!

Do you think the European governments would support Airbus if it wouldn’t sell any airplanes? N79969 I believe you are just starting another of your anti Airbus campaigns.
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:23 pm

Osteogenesis,

I know it. I think what Europe has done and what the US has tolerated is simply unacceptable. Do you actually believe the A300/310 were actually commercially viable projects with normal rates of return in standard time horizons? No way. The EU (France in particular) was not happy about the American 'monopoly' (the fact that several US firms competed was an inconvenient fact) and Euro politicians blathered on about 'strategic' industries and so on. Airbus is a jobs transfer program from a government perspective. Transfer jobs from Palmdale, Long Beach, Renton, and Everett to Tolouse and Hamburg.

330/340 is an unknown as books were not really kept back then. The 320 is the only series produced that I believe is profitable. Yet the money keeps rolling from the EU.

Further the fact that the EU has issued a r&d loan for the 380 that must be repaid only if the A380 is profitable is utterly ridiculous. Guess which Airbus program will not show a profit for a while? I think that "while" will be the period of the loan repayment horizon plus a day.

The A380 repayable loan demonstrates Europe's continued willingness to not only ensure Airbus survival but to ensure that it dominates at any cost. It just made a $3 billion bet.

[Edited 2003-08-21 16:27:49]
 
rabenschlag
Posts: 1012
Joined: Fri Oct 20, 2000 10:28 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:27 pm

its no news that boeing programs received subsidies via hidden paths, and the article makes clear that there were direct subsidies for the latest programs (767, 777).

allowing japan to pump state money into the triple seven program is a very smart move in political terms. it:

* allows to keep the own hands clean and to continue to blame competitors

* saves US money (which is badly needed those days of record federal deficits)

* makes political pressure to buy american (as, i.a., in the case of el al) unnecessary, as japan itself will put pressure on national carriers to buy heavy-boeings

in sum, it pays off. financially, psychologically.




 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:41 pm

I would agree that Japanese tax money subsidizing the work of Ishikawajima-Harima, Kawasaki, and Fuji for Boeing subcontracts are backdoor subsidies that distort the market. Airbus has a legitimate point here.
 
racko
Posts: 4548
Joined: Tue Nov 06, 2001 12:06 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:42 pm

CX747, didn't you read the article? The 767 was 16% subsidie-financed, 20% of the 777 were. That is by the Japanese heavy industry. Also Japanese are put under pressure to buy Boeing planes. Put please, stay in your dream-world of the lonesome hero Boeing fighting on his own against the bad-boy Airbus, supported by the whole of Europe.

Military sales: It's so easy. Say, a car costs 30.000€. Now the local government comes to the car dealer and says "We take 100 cars for 60.000€ each." Is that just a usual deal (who of us doesn't pay twice the catalog price for anything he buys ?!), or is that a government subsidie for the local car dealer?
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:42 pm

Do you think the European governments would support Airbus if it wouldn’t sell any airplanes?

N79969 answer: I know it.

 Nuts

You are a real fanatic. Do you know that?


[Edited 2003-08-21 16:45:00]
 
gigneil
Posts: 14133
Joined: Fri Nov 08, 2002 10:25 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:45 pm

Fortunately its illegal for the FAA to participate... this is the same reason why Emirates can't fly to the US. We have an independent oversight committee here.

If you want to get back to the days of the A300, then both the US and Europe were equally guilty. The government directly bailed out the L-1011... and more often than not provided Boeing with free research by way of NASA.

Don't forget that the US also orders around helpless countries to order Boeing.

Comparing past wrongs is pointless. More modern offenses are probably the way to go to compare the business models of the two Unions.

There's also more documentation now, so whatever happens or is happening will be easier to follow.

N
 
CX747
Posts: 5576
Joined: Tue May 18, 1999 2:54 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Thu Aug 21, 2003 11:51 pm

How did Boeing receive direct government subsidies on the 767/777 program? Boeing does military work for the Defense Department and Nasa. It is not "gifted" this money as Airbus is. It has to produce a good or service in order to receive its payment. 2 totally different programs. Think of it this way.

Boeing: Has to mow the lawn in order to receive $20 from its parents.

Airbus: Is given $60 for doing nothing more than sitting in his room.
"History does not long entrust the care of freedom to the weak or timid." D. Eisenhower
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:09 am

CX747,

gift <> loan  Smile/happy/getting dizzy

gift is not a loan



[Edited 2003-08-21 17:11:17]
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:13 am

Loans that probably will not be paid back are gifts.
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:17 am

N79969,

Loans that probably will not be paid back are gifts.

Not until you can eliminate the word “probably” with some facts.  Smile/happy/getting dizzy

You don’t have a case my friend.
 
rabenschlag
Posts: 1012
Joined: Fri Oct 20, 2000 10:28 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:19 am

in order to persuade boeing to build the 7e7 plant in their states, US federal states are offering to susidise the 7e7 with up to 3.2 billion US dollars (state of washington). perhaps boeing will agree to the offer.


http://www.stateline.org/story.do?storyId=316846


"but hey, they are creating workplaces! thats not subsidies, that business"

signed CX747
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:25 am

Subsidies = gifts

loans <> gifts

Its really simple!
 
keesje
Posts: 8752
Joined: Thu Apr 12, 2001 2:08 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:25 am

The Unbearable thought Boeing could be in problems for reasons other then European subsidies ...

CX747, N79669, pls read the following slowly & repeat it for yourself :

- The 767, 747, 757 are not hot selling, because they are probably not good enough anymore ..

- Boeing wasn't understanding the market when they proposed SC and told the world there is no market for a 500+ aircraft

- The governement support Boeing received for developing & building aerospace products in the last 40 yrs can and will never be matched by Airbus. The amount is simply MindBoggling ...

- What is proposed now is basicly state support protecting the strategic assett Boeing.

Blaming Airbus might by comforting, but not the problem for Boeing.

A vs B ?
No, I believe in 737/8, 777 and 7e7 medium range variant....
"Never mistake motion for action." Ernest Hemingway
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:27 am

Hey Rabenschlag,

Do you realize that BMW and Daimler Chrysler also received tax breaks/holidays to build factories in South Carolina and Alabama? Toyota received them from Kentucky?

Osteogenesis,

You are kidding yourself if you actually think there is a real likelihood that Airbus will pay back A380 loans. They sold quite a few at launch prices. It will take them a long time to reach break-even. Airbus has all the incentive and all of the opportunity in the world to defer profits long enough to avoid paying a $ 3 billion loan. That is a gift. A giveaway.

Keesje,

The Boeing are not selling well because:

1. Slow economy
2. Saturation of the niches- everyone that needs 757s has them.
3. Aggressive pricing by Airbus (e.g. EasyJet)


Hope you guys like Thai prawns, you should be able to get them cheap real soon.


[Edited 2003-08-21 17:29:55]
 
osteogenesis
Posts: 494
Joined: Tue May 27, 2003 9:44 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:32 am

N79969,

Do you realize that BMW and Daimler Chrysler also received tax breaks/holidays to build factories in South Carolina and Alabama? Toyota received them from Kentucky?

Do you know all Airbus Aircraft have many parts build in the US?

You are kidding yourself if you actually think there is a real likelihood that Airbus will pay back A380 loans.

You are kidding yourself if you actually think there is a real likelihood that Airbus will pay back A380 loans. They sold quite a few at launch prices. It will take them a long time to reach break-even. Airbus has all the incentive and all of the opportunity in the world to defer profits long enough to avoid paying a $ 3 billion loan. That is a gift. A giveaway.

Proof?
 
rabenschlag
Posts: 1012
Joined: Fri Oct 20, 2000 10:28 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:39 am

@N79969:

"Do you realize that BMW and Daimler Chrysler also received tax breaks/holidays to build factories in South Carolina and Alabama? Toyota received them from Kentucky?"

yes, i do. and this translates to:
some federal states of america are subsidising national and international companies. and in the case of boeing, this is about to happen in a very drastic way.

interestingly enough, using tax-payers money to subsidize jobs that would not be created without such subsidies is a quite "socialistic" take on economy.



@N79969:

"You are kidding yourself if you actually think there is a real likelihood that Airbus will pay back A380 loans. They sold quite a few at launch prices. It will take them a long time to reach break-even. Airbus has all the incentive and all of the opportunity in the world to defer profits long enough to avoid paying a $ 3 billion loan. That is a gift. A giveaway."

who is kidding. we just learned that washington is offering 3.2 billion dollars for free, not as a loan, to subsidise boeing for building the 7e7 in washington. and you are blaming the EU to give a repayable loan of 3.0 billion us $ to AI. i agree that AI will do anything to prevent the repayment. but actually they are repaying loans right now. so there is a chance that the money will flow back.

is there a double standard or not?



sometimes, things arent what they appear to be at first glance. this is true for almost everything. perhaps this also applies to US politics and economy. think about it. although "e pluribus unum" is a heartly accepted motto, maybe the US arent that much unique and morally superior on some dimensions.





[Edited 2003-08-21 17:41:31]
 
wingman
Posts: 2795
Joined: Thu May 27, 1999 4:25 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:45 am

Sweet Jesus, someone in government is finally realizing how the EU has screwed Boeing to the wall with this ongoing 30 year breast feeding of Airbus. Now it's time to turn the tables. The one thing the Airbus fans never seem able to respond to is precisely where the indirect subsidies end up in Boeing Commercial aircraft. Is it Fly By Wire...oh right, that benefited Airbus. Where exactly do you see government subsidies on the commercial side of the business??? Nowhere!!! This is nothing more than a pathetic attempt by Airbus to deflect attention away form the fact that even with 50%+ marketshare it has neither the balls nor the business acumen to succeed on its own merits. And that's OK, as long as Boeing gets to play on an even field. Second step of course, will be to completely absolve Boeing of all taxation until 2034. Then we'll see what the market truly looks like.

Airbus, great planes built by grown children who still can't feed themselves.
 
keesje
Posts: 8752
Joined: Thu Apr 12, 2001 2:08 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 12:54 am

The one thing the Airbus fans never seem able to respond to is precisely where the indirect subsidies end up in Boeing Commercial aircraft.
http://www.boeing.com/ids/flash.html

Exactly do you see government subsidies on the commercial side of the business??? Nowhere!!!
What would you say if EC had bought 800 A300 tankers in 1972-1976's ?  Smile/happy/getting dizzy

And that's OK, as long as Boeing gets to play on an even field.

Boeing is adjusting & learning to do this at the moment, and it isn't easy ...
"Never mistake motion for action." Ernest Hemingway
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:04 am

Rabenschlag,

Let's put it this way. If it were not for government giveaways from the EU, the A300 would have been Airbus first and last airplane. No doubt.

I squarely blame the EU that despite 30 years of existence, Airbus gets something lie a 3 billion "loan" which is more akin to the "loans" given to adult children that still live at home.

The DoD bought commercial developed technology off the shelf and that is a subsidy?

How about the A400M? How do you reconcile that boondoggle?

Keesje,

What in the heck would the EU do with 800 tankers? A good number of our Boeing tankers and surveillance planes were guarding Europe from a Soviet invastion.



[Edited 2003-08-21 18:12:40]
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:10 am

N79969,

Writes once again...

Aggresive pricing by Airbus (e.g. Airbus).

I do not have acces to these contracts, but if you say so, may I remind you that O' Leary stated several times that he raped Boeing. yesterday there was a programm about him on Belgian television, insiders said that Boeing has given up to 50% discount on the 100+ Ryanair order. Now, aggresive pricing by who? Or is that just another reason why Boeing is getting into trouble? Producing aircraft not with profit, not with break even but with a lot.

Hmmm, I love Thai prawns!  Big thumbs up
SUPPORT THE LEBANESE CIVILIANS
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:14 am

According to most Euro-whining, O'Leary is a braggart and a liar. But now you guys believe him?
 
rabenschlag
Posts: 1012
Joined: Fri Oct 20, 2000 10:28 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:20 am

N79969:

i squarely blame the USA that despite more than 70 years of existence, Boeing gets something like a 3.2 billion gift, which is a gift is a gift is a gift.

to be honest, i do not blame anyone. i just wanted to parodise your lament. as a grown up boy (left my parents home quiete some time ago), i know that free markets only exist in economy textbooks, just as the homo oeconomicus only exists in textbooks (see last nobel prize in economics). and i am also grown up enough to know that a country that payed scientists to develop game-theory to win the cold war, will never be the friedly fool in a prisoners dilemma.


take a catholic perspective on it: we are all little sinners.








 
cwapilot
Posts: 1085
Joined: Mon May 01, 2000 7:10 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:32 am

As the old saying goes: If you can't beat 'em, join 'em.
Southside Irish...our two teams are the White Sox and whoever plays the Cubs!
 
IslandHopper
Posts: 309
Joined: Mon Feb 10, 2003 8:28 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 1:52 am

As mommy always told me: Two wrongs don't make a right!

Your right though, free market economy is dying, but that doesn't make it right. Governments don't ever shrink, they grow. I think that US government is growing too large, taking too much of my money to subsidize industries like farms, auto plants, and airplanes that could do just fine on their own.

Government help makes businesses lazy and unproductive. I still can't believe all the people in Germany and Netherlands and most other EU countries allow their governments to take 50-70% of their income in taxes!!! At least the US only takes about a third of a middle-class person's income.

Let Boeing and Airbus fend for themselves, they'd both do just fine.
 
Joni
Posts: 2613
Joined: Thu Aug 10, 2000 11:05 pm

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 2:00 am


An independent body had also analyzed the 767 tanker deal and concluded that Boeing was overcharging anout USD 2bn over the 15% profit margin they were supposed to have. Combined with Washington's tax break, that's already more than 5bn in sheer cash.

Also, according to an EU report Europe should double its aerospace subsidies to match those given by the US.

 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 2:18 am

Rabenschlag,

Your explanation is a whitewash. To compare the gift of immortality conferred unto Airbus by the EU to the application of knowledge learned in defense contracts to commercial airplanes by Boeing is only something that could only make sense within Europe.

Like I said if economics drove Airbus, the A300 would have been the last airplane out of Tolouse.
 
MidnightMike
Posts: 2810
Joined: Thu Mar 06, 2003 10:07 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 2:20 am


It would be great if this 7E7 would be built in Long Beach California, I know the chances are slim to none, but what the hell!
NO URLS in signature
 
wingman
Posts: 2795
Joined: Thu May 27, 1999 4:25 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 2:32 am

Keesje, so you mean that Boeing commercial aircraft converted to military purposes is a subsidy for the commercial side of the business? Doesn't make any sense. The commercial airframe is coverted to a special purpose mission requiring government funding to create the specialzed technology intergration to an already exsting airframe technology. However, that technology is not used in commercial aircraft sold to the airlines. Unless you've seen LH or SIA 747s with airbornes lasers on them...???

What the EU dreams of doing is matching not the subsidies to EADS, but actually placing orders with Airbus to make their military operation as large as Boeing's. The A400M is a start in that direction but no one really sees the EU developing a military capability even half as large as the US has. And why should they, even I would agree this is a complete waste of taxpayer money. The one thing the EU certainly does better than the US is prioritize government funding in the areas of education and healthcare. But that's another debate for another forum.
 
dynkrisolo
Posts: 1825
Joined: Mon Feb 12, 2001 12:12 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 2:33 am

Manni:

This is not the first time you quoted Ryanair's 738 order as an example of aggressive pricing by Boeing. FWIW, the press had quoted 40% discount. Another Boeing example would be SAS's 736 order which was also reported discounts in the 40% range. But I am not aware of too many more on Boeing's side. On Airbus's side, I can think of Easyjet's 319 order (near 50%), Swiss's 343 (near 40%), SAA's 343/346 (near 40%), Virgin's 346 (renegotiated discounts on top of the launch discounts), Virgin, SQ, and QF's 388 (40+% from Airbus, 90+% from R-R, and walk-away options), IB's 346 (30-40% plus guaranteed residual value)... I hope you get the picture.
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 3:15 am

Besides the large discount, Airbus will provide the following to Easyjet:

Pilot training
Reimbursement for the costs of operating a mixed fleet (costs of spare inventories, etc)
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 3:33 am

Dynkrisolo,

It doesn't matter how many customers were given discounts. Boeings is just like Airbus trying to get orders by discounting their aircraft with high percentages. It makes no sense to blame Airbus for Boeings troubles, this is called competition.

You say the Ryanair order was discounted by 40%, the guy on TV yesterday said 50%. Perhaps you are right, perhaps he got it right or perhaps you both got it wrong, I could care less. Tell me, do you work for Airbus? Where do you get your figures from concerning the discounts Airbus has given to its customers or are you just guessing?

BTW, I did not see any picture, did you provide a link?  Big thumbs up
SUPPORT THE LEBANESE CIVILIANS
 
Scorpio
Posts: 4794
Joined: Thu Oct 04, 2001 3:48 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 3:47 am

But I am not aware of too many more on Boeing's side.

Let me help you: Exclusivity contracts for AA, DL and CO. Hundreds and hundreds of planes. There's a reason why they originally signed a contract to buy exclusively from Boeing for 20 years, you know... And it's not because they like Boeing so much, it's because the planes were DIRT CHEAP. The morale? Both Boeing and Airbus are equally quilty of discounting.
 
L.1011
Posts: 2163
Joined: Mon Aug 13, 2001 7:46 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 3:57 am

OMG! Boeing gave a BIG discount on 1 order! Uh oh Europe, the sky is falling! Uh oh, Boeing converted their commercial planes into military airplanes that are some of the best in the world! The government spent money on said planes. OMG! Boeing's being subsidized! Well if that's your logic, than government-owned Air France buying 777s is (gasp!) the French government subsidizing Boeing! Oh, the EU gave Airbus a $3b loan for the A380 that doesn't have to be payed back unless the program is profitable. Airbus sends A380s out to QF for half price,does the EU give a damn, of course not! The State of Washington gives Boeing, which has employed tens of thousands of Washington residents for decades, a $3.2b gift and the suns gonna explode! The US government decides to level the playing field for Boeing by subsidizing them, the EU has been doing the same for 31 years but if the US tries it the universe is ending! But you have no problem with the EU doing it, because they can do no wrong. The US apparently can do no right.
 
dynkrisolo
Posts: 1825
Joined: Mon Feb 12, 2001 12:12 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 3:59 am

Manni:

It's not the same. It's not uncommon for any businesses to offer higher-than-normal discounts to strategical customers. The SK order was crucial for the 736 launch and it also made the MD95 less competitive. The Ryanair order was to keep Boeing's claim that the 737 was THE choice for LCC. The Easyjet order was critical for Airbus to have a foothold in the LCC market. The 388 orders by SQ, VS, and QF were also critical for launching of the 388. So, they would fall in the FR 738 and SK 736 category. But heavy discounts on orders for IB, LX, SA, and some others that I didn't mention were questionable. Once a while, I came across data from very reliable sources, but I don't think I can quote them in the public. The discounts that I quoted above were found directly or indirectly in the media. You just have to look for them with some extra efforts. The media aren't always right, but I usually have a decent idea of their accuracy based on other information I have.

Obviously, you don't see the picture. Big grin
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:03 am

Scorpio,

I believe those exclusivity contracts were torn up after the EU complained.

In the case of CO, there is no chance that they will buy Airbus so long as a former Boeing-VP is their CEO.

Delta and American have placed enormous orders with Boeing and probably get good deals just as Lufthansa surely does not pay much for their rather substantial fleet of Airbus. There is nothing out of the ordinary there.
 
B747FAN
Posts: 78
Joined: Tue Jul 25, 2000 12:07 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:06 am

Greetings,

Note: The A380 is still 2 - 2.5 yrs from being launched. The success of that airplane is yet to be determined. And for those of you saying that Boeing misunderstood the needs of the market (500+ passenge airplane), how can you tell???? The A380 has not flown yet. It has not proved itself. The B-747 has been flying since 1969, When the A380 gets to that age, then you Euros will have some ground to stand on. Until then, you have no say.

) He turns not back who is bound to a star. - Leonardo Da Vinci.
 
dynkrisolo
Posts: 1825
Joined: Mon Feb 12, 2001 12:12 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:12 am

Scorpio:

Obviously, you haven't heard of volume discount. Why don't you ask what kind of discounts ILFC is getting from Airbus? I can assure you they don't get any less than CO, DL or AA from Boeing. Does ILFC "deserve" the discounts? Why not? They are the biggest customer of Airbus! Same goes with CO, DL and AA. They have bought hundreds of planes from Boeing.

 
MITaero
Posts: 485
Joined: Mon Jul 28, 2003 8:00 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:23 am

I kinda agree with Sabena 690.. if you don't know what's really going on, you really don't have the right to argue so fervently.

btw - not picking any sides here, just stating that fact  Smile

[Edited 2003-08-21 21:26:25]
 
manni
Posts: 4049
Joined: Thu Nov 08, 2001 1:48 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:30 am

Good point Sabena690.

Anyway, why is it that some of the US citizens on this forum are whinning about Airbus recieving so called subsidies from the EU , while its' not even their money? We should be the ones complaining, its' afterall my money that's used, but since we dont, I guess we dont really care  Big grin!

Dynkrisolo,

If LX, IB and SA orders were heavily discounted the reason for that would have been to win the order. I do not see anything wrong with that. Again, that's were competition is all about.

BTW, Dont forget the TG order Airbus got in exchange for cheap Thai prawns. That's got to be another of these reliable sources.  Big thumbs up
SUPPORT THE LEBANESE CIVILIANS
 
Scorpio
Posts: 4794
Joined: Thu Oct 04, 2001 3:48 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:31 am

See, when you point out the discounts given by Boeing, the anti-Airbus crowd gets all defensive, yet they are surprised that we do the same after the umpteenth time they've attacked Airbus for its discounting. We must be doing something right  Big grin

N79969,

I am well aware the exclusivity clause was torn up, hence the 'originally' in my first post. But the huge discounts remain. And no, there's nothing wrong with them getting huge discounts. But why is it so very hard for you to understand that there's nothing wrong with the discounts Airbus gives either? Double standards anyone?
 
DoorsToManual
Posts: 1453
Joined: Sat Apr 19, 2003 12:28 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:37 am

if you don't know what's really going on, you really don't have the right to argue so fervently

LOL, the appropriate term for what you are doing here is "flogging a dead horse". No one is going to listen to that piece of (good) advice!

Come on guys, this sort of thing has always been around. Despite what Western governments preach about 100% free markets with no protectionism/subsidies/whatever, in the end, they will always act in their own interests.

Personally, I will admit that I know very little about the world of business or even "capitalism" (more of an arty person), but there might be occasions when some government support might be a good idea/beneficial, in terms of job creation, social development etc. etc.

If both Airbus and Boeing get a little support through tax breaks or loans, well, maybe that's a good thing. I hope this doesn't sound too radical, and I have probably infuriated some free-marketeers here.

I'm open to suggestions.

Basically, lets do whatever works out best.
 
N79969
Posts: 6605
Joined: Tue Jan 29, 2002 1:43 am

RE: Aerospace Lobby Wants U.S. To Push Boeing 7E7

Fri Aug 22, 2003 4:52 am

Not being 'insiders' in the US government has never stopped or slowed down Sabena 690 etc others from opining on the "real reasons" behind U.S. foreign policy and other issues that necessarily would require 'insider' knowledge. Perhaps Sabena 690 should take his own advice.

Everything that has been posted so far has been available in the public domain for years.

Manni,

EU money is being spent in away that reduces the economic well being of U.S. citizens in form of lost jobs and loss of shareholder value. That is a problem.

The EU is now threatening Taiwan for selecting GE engines for their Airbus and Boeing airplanes. The EU whined to PM Koizumi after ANA purchased B737s. Your politicians do far more whining than anyone else.


Scorpio,

You made it sound like those deal still existed. That was kind of misleading. Notice no one is complaining about discounts to loyal customers like LH. LH is a good customer and should get the best price out of Airbus.

But deals like the ones given to IB and EasyJet are not ordinary. Airbus has basically assumed the entire risk of the transaction in a ways that do not make economic sense. They are taking risks that for-profit enterprises usually cannot take save some serious insurance.

Who is online

Users browsing this forum: aflyingkiwi, agrflyer, AirportRival, Baidu [Spider], brajur, euroflyer, hkcanadaexpat, moo, PanAm_DC10, PerfectGriffin, Planesmart, rutankrd, solnabo and 249 guests