28-04-2005 17:47									#61
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Remind me, how big are the subsidies/tax breaks Boeing gets directly?

	28-04-2005 17:56									#62
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quote: European contractors can and do win large lucrative defense contracts so how is it when Boeing competes and wins in this market that it is some how a subsidy?

The same as our ***** defense minister does? Construct the order in such a fashion that there's only one company in the world that can make it...which just happened to be located in his home town.

	28-04-2005 17:58									#63
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In 2004, Boeing got $2,468,121,000 in defense contracts. (Oh, and I was incorrect, Boeing has lost the number one spot in 2004 to Northrup)

That is a HUGE revenue stream and allows Boeing to better survive the ups and downs of the commercial aircraft business, and to invest in the future... And much of the research they do on military aircrafts can be moved to the commercial side of the business at very little additional cost... Alloys, avionics, design elements needed for their defense work is built into the commercial aircraft as relevent. This is a distinct advantage that Airbus doesn't have. Think about it... an almost guaranteed revenue stream of 2.6 billion dollars... while Airbus has to rely on non guaranteed orders from airlines for future possible delivery of aircraft. They need the loans and subsidies...

	28-04-2005 17:58									#64
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There are claims that the Japanese government has given a Japanese supplier a direct subsidy and I have heard the states of Washington and Utah have agreed to wave property taxes on the Boeing plants in those states in order to keep the company from moving production to lower cost areas. The Japanese government's subsidy to that one supplier isn't a subsidy to Boeing and instead is a Japanese subsidy to its industry and Boeing just bought parts from the cheapest supplier but the waving of local taxes is a small but direct subsidy. I'd guess it couldn't amount to more then a few million in saved propertry taxes. Airbus on the other hand gets massive public finanancing of its debts and free start up capital for every project. We are talking about orders of magnitude difference.

Last edited by Oerdin on 28-04-2005 at 18:05

	28-04-2005 18:04									#65
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quote: Originally posted by Ming This is a distinct advantage that Airbus doesn't have. Think about it... an almost guaranteed revenue stream of 2.6 billion dollars... while Airbus has to rely on non guaranteed orders from airlines for future possible delivery of aircraft. They need the loans and subsidies...

I agree being commercially successful in all areas is a distinct advantage but Airbus is free to compete for those orders just like Boeing does. European manufacturers do great when it comes to US military projects the number two defense contractor is British Aerospace while all US Army rifles are made by a German company and all 9mm pistols are made by an Italian company. Europeans can and do compete and win in the defense contract business.

Boeing has worked hard to come up with good defense products and they've won those contracts while facing stiff competition; there was no free gifts or free rides. They had to work for those contracts and now the company is enjoy profits based upon that hard work and those innovative products.

Airbus didn't have to compete for the business of the various European State owned Airlines though since they are legally required to purchase only Airbus planes. You want to talk about subsidies lets talk about a locked in maket with some of the largest airlines in Europe and that is on top of all the direct cash subsidies. This is unfair protectionism and its harming American business.

	28-04-2005 18:22									#66
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And protecting European business. That's the European governments' job.

	28-04-2005 18:25									#67
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Then why open the can of worms of whining about Boeing.

	28-04-2005 18:26									#68
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Except it violates trade rules.

	28-04-2005 18:30									#69
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quote: I agree being commercially successful in all areas is a distinct advantage but Airbus is free to compete for those orders just like Boeing does. European manufacturers do great when it comes to US military projects the number two defense contractor is British Aerospace while all US Army rifles are made by a German company and all 9mm pistols are made by an Italian company. Europeans can and do compete and win in the defense contract business. Boeing has worked hard to come up with good defense products and they've won those contracts while facing stiff competition; there was no free gifts or free rides. They had to work for those contracts and now the company is enjoy profits based upon that hard work and those innovative products. Airbus didn't have to compete for the business of the various European State owned Airlines though since they are legally required to purchase only Airbus planes. You want to talk about subsidies lets talk about a locked in maket with some of the largest airlines in Europe and that is on top of all the direct cash subsidies. This is unfair protectionism and its harming American business.

might i remind you all that when saudi-arabia wanted to renew its fleet of transport aircraft they wanted to buy airbus...but then the president of boeing called the president of the US who then called the saudi's telling them: buy boeing or you lose all your military contracts with the US...and suddenly the went with boeing not because it was the better choice plane wise but because boeing needed the 2 billion + contract with saudi-arabia

	28-04-2005 18:36									#70
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my point being that boeing gets as much help as airbus is getting believe it or not

	28-04-2005 18:41									#71
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I'm not seeing the subsidy and instead I see the American government trying to correct the imbalances created by the massive direct cash which European governments put into Airbus's pockets. The Saudis likely decided on Airbus planes because they were cheaper and the reason the planes were cheaper is because of cash subsidies from European governments. Also do you have any evidence that the US threatened Saudi Arabia if it didn't switch the contracts verses simply conducting diplomacy about a politically important sale?

	28-04-2005 18:48									#72
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quote: Airbus didn't have to compete for the business of the various European State owned Airlines though since they are legally required to purchase only Airbus planes.

False. And the only Only-Airbus airlines i can think now is Frontier Airlines or Jetblue both American airlines.

What Cry babes. "Oh no they have built a plane bigger that any of ours, what humiliation". What a losser attitude.
90% of airbus contracts are for non-europeans airlines. There is about 1300 Airbus in North America Airlines only. It is simple: Airbus builds better products, so Airbus wins contracts.

About defense trade, do you think USA government doesnt protect American defense bussines? I would say it is his first priority.

	28-04-2005 18:51									#73
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quote: Originally posted by Thorgal About defense trade, do you think USA government doesnt protect American defense bussines? I would say it is his first priority.

Then why would Euros open the can of worms of whining about Boeing.

	28-04-2005 18:52									#74
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quote: Originally posted by Oerdin Except it violates trade rules.

When everyone else sticks to them we will, until then why shoot ourselves in the feet.

	28-04-2005 18:56									#75
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quote: Also do you have any evidence that the US threatened Saudi Arabia if it didn't switch the contracts verses simply conducting diplomacy about a politically important sale?

conducting dimplomacy vs. threating...dont see much difference

but to answer your question no...i will have to look it up...got the story and link from my professor aerodynamics and FUEL ECONOMY ....and he is an american btw

	28-04-2005 19:00									#76
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quote: Originally posted by Oerdin I'm not seeing the subsidy and instead I see the American government trying to correct the imbalances created by the massive direct cash which European governments put into Airbus's pockets.

Sounds like a PR release from Boeing

You just aren't looking at the big picture... I worked on a major defense contractor account for over 17 years, and got to see what a distinct advantage they had on the commercial side thanks to their defense contracts... they would sit around and discuss it while laughing about it... If you truely think that defense contracts are soley awarded based on the value of the specific proposal, you are living in a fantasy world

	28-04-2005 19:23									#77
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I thought they were based on which senator was having a close call for reelection, backhanders and other general corruption.

	28-04-2005 19:24									#78
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That's how they work here anyway.

	28-04-2005 19:28									#79
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quote: Originally posted by Ming In 2004, Boeing got $2,468,121,000 in defense contracts. (Oh, and I was incorrect, Boeing has lost the number one spot in 2004 to Northrup) That is a HUGE revenue stream and allows Boeing to better survive the ups and downs of the commercial aircraft business, and to invest in the future... And much of the research they do on military aircrafts can be moved to the commercial side of the business at very little additional cost... Alloys, avionics, design elements needed for their defense work is built into the commercial aircraft as relevent. This is a distinct advantage that Airbus doesn't have. Think about it... an almost guaranteed revenue stream of 2.6 billion dollars... while Airbus has to rely on non guaranteed orders from airlines for future possible delivery of aircraft. They need the loans and subsidies...

Government contracts do not have the same impact as subsidies -- it's like comparing apples and oranges. Adam Smith has gone through those differences several times here on Apolyton.

	28-04-2005 19:29									#80
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quote: Originally posted by MikeH I thought they were based on which senator was having a close call for reelection, backhanders and other general corruption.

Actually... you are totally correct and that it is an important factor.

On one HUGE defense contract, the key was setting up production and supplier support in as many congressional districts as possible... spreading the jobs out to as many "votes" as they could... so even if the contract came under fire, there was a built in base of law makers who had a vested interest in keeping the jobs in their districts

	28-04-2005 20:26									#81
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In the same manner than the US is claiming that the Chinese currency is undervalued, the EU could claim that the USD is undervalued. With costs in Euros, and market prices in USD, the poor Airbus Industry can hardly make a living; it would be just fair to subsidize Airbus for the sake of solidarity.

	28-04-2005 20:58									#82
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quote: In the same manner than the US is claiming that the Chinese currency is undervalued, the EU could claim that the USD is undervalued. With costs in Euros, and market prices in USD, the poor Airbus Industry can hardly make a living; it would be just fair to subsidize Airbus for the sake of solidarity.

Except the Europeans claim that Chinese currency is undervalued too. And indeed, the fact that planes are sold in dollars actually hurts Airbus, since they may need 50 more planes than planned to turn out a profit.

Back to the number of seats: Even though it's capacity is a bit more than 800, and is sold for 515 seats, no company bought that configuration, only some 400+ size configs, so people should definitely have some room in these panes when they start flying.

	28-04-2005 23:09									#83
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quote: Originally posted by DanS Government contracts do not have the same impact as subsidies -- it's like comparing apples and oranges. Adam Smith has gone through those differences several times here on Apolyton.

Yep... apples and oranges, and I do not mean to imply that they are the same thing. However, if you are implying that HUGE government contracts have no impact and don't significantly aid the company in their other ventures, you are sadly mistaken

	28-04-2005 23:14									#84
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quote: Originally posted by Lancer Yes I just read the thread in your link. Looks a bit complicated. Maybe I'll wait until it's further along. I'm not a comp whiz and lazy about such stuff. Will BETA 5 be easier?

hmm I'll try to include all past patches

	28-04-2005 23:30									#85
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If there is to be retaliation (after we win in the WTO), I would prefer to take it ALL out on French products. If there are not enough French products sold in the US, then add tarriffs to any products also sold into France.

The money raised from the retaliatory tarriffs could then be used to subsidized the next Boeing behemoth.

As to the plane itself, it looks good. I expect it will soon replace the aging 747 fleet worldwide.

	28-04-2005 23:54									#86
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quote: If there is to be retaliation (after we win in the WTO), I would prefer to take it ALL out on French products. If there are not enough French products sold in the US, then add tarriffs to any products also sold into France.

Just about as feasible as having the EU confiscate all aircraft produced in America...

	28-04-2005 23:55									#87
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quote: Originally posted by Ned If there is to be retaliation (after we win in the WTO), I would prefer to take it ALL out on French products. If there are not enough French products sold in the US, then add tarriffs to any products also sold into France. The money raised from the retaliatory tarriffs could then be used to subsidized the next Boeing behemoth.

I am sorry if it desappoints you, but in the state of the world as it is, the US cannot retaliate on France, but only on the EU as a whole. I know that you prefer opponents much smaller that the US, as you already demonstrated with the preemptive war on Iraq, but it is not always possible.

	28-04-2005 23:59									#88
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Davout, bull. The thing that forced Bush's hand on the steel tarriffs was the EU's intention to target so-called "red state" products with the specific intention of unseating Bush in the last election.

We could figure out something similar for France.

	29-04-2005 00:12									#89
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quote: Originally posted by Ned Davout, bull. The thing that forced Bush's hand on the steel tarriffs was the EU's intention to target so-called "red state" products with the specific intention of unseating Bush in the last election. We could figure out something similar for France.

I was not aware of this horrible plot, and I think that nobody in Europe was informed of it. In that case, it is sure that something similar could be organized against an unbearable country.

	29-04-2005 00:12									#90
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Why just against France? The wings and engines are made in Britain.