THE German government is planning to follow France’s example and offer support to airlines to help bolster sales of Airbus aircraft.
But the big question now is whether the UK government will fall into line and offer funding for aircraft purchases, a move which will help protect the jobs of the 7,000 aerospace workers at Airbus’s wing-making plant at Broughton, near Chester.
Reports from Berlin yesterday said the German government was talking to state lender KfW and domestic banks about steps to help Airbus customers gain access to finance.
Peter Hintze, a state secretary in the economy ministry and government aerospace coordinator, said customers were having trouble gaining access to liquidity for plane purchases despite government guarantees.
"We are talking with KfW and the banks about a market-friendly model that makes financing, on the basis of (existing) government guarantees, easier," he said.
He predicted a final decision would be made in the next three or four weeks.
The assistance would help airlines buy Airbus airliners and secure exports.
The French government has already moved to encourage banks to lend money to facilitate Airbus deliveries to foreign airlines.
EADS chief executive Louis Gallois said earlier this week that he wanted Germany and the UK to follow suit.
Just days ago, Chancellor Alistair Darling told the Liverpool Daily Post the UK government remained “committed” to helping Airbus retain wing manufacture. He said the country could not afford to lose the aerospace skills at Broughton and the government had given launch aid for the development of wings for new models and support for research and development, including work on the next generation of carbon composite wings.
“We talk to Airbus all the time and we are very committed to doing whatever we can,” said Mr Darling. He refused to be drawn on the possibility of special measures to help the industry.
However, with government support for the UK's car industry unveiled yesterday, the next sector to receive additional support could be aviation.
The issue of state aid for Airbus is a sensitive one for the company, which has been accused by US rival Boeing of accepting illegal state subsidies. Airbus denies that and claims the UK government help has been in the form of repayable loans.
The complex dispute, with counterclaims by Airbus against Boeing, has gone for settlement to the World Trade Organisation.
The bottom line is that both companies are braced for a tough year as many airlines and other operators cancel or defer orders.
Airbus chief executive Thomas Enders has warned that demand for new aircraft could plunge by more than half this year.
The only upside is that Airbus is cushioned from the impact of plummeting orders by an orders for more than 3,000 planes which would take several years to work through.
French trade minister Anne-Marie Idrac denied her government’s £4.7bn aviation package distorted competition. "The French state is not giving money to Airbus,” she said.
“It's not a subsidy, which would distort competition. It's a question of fluidity in the financing of Airbus clients, where it is needed, and this in co-ordination with other countries who are stakeholders of Airbus.”
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