The Boeing-Airbus “Can of Stink.” EUMA Papers, Vol. 5, No. 2 January 2008

Alvarez-Perez, Fernando. (2008) The Boeing-Airbus “Can of Stink.” EUMA Papers, Vol. 5, No. 2 January 2008. [Policy Paper]

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Abstract

The European Union and the United States have the largest trading relationship in the world, comprising about 60% of world trade (Perdikis and Read 267). They are also the greatest proponents of trade liberalization and multilateral trade cooperating in the world. Boeing was the undisputed king of aircraft manufacturing for most of the 20th century. Airbus has been encroaching upon that position since the 1970s. In 2000, Airbus dethroned Boeing in terms of sales, and the two have been in a bitter battle since. A subsidy dispute currently underway between Boeing (supported by the US) and Airbus (supported by the EU – mostly from Germany, England, France and Spain) could have devastating consequences upon that relationship and their credibility in promoting neoliberal values abroad. Most trade disputes are solved through consultation, without the need for a ruling by the World Trade Organization. Unlike most others, dispute regarding aircraft has elicited a special and unprecedented aggression on the part of these two trading partners.

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