STONECIPHER
Anne Ryan  /  AP file
“Trade wars, as they go on and on and on, are not in anybody's best interest ... Probably Airbus's biggest market is the U.S. market, so I don't think they want a trade case and neither do we,” said Boeing CEO Harry C. Stonecipher.
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updated 6/29/2004 12:20:51 PM ET 2004-06-29T16:20:51

Boeing, the U.S. aerospace company, is becoming increasingly assertive in its attacks against Airbus, its European rival — which has been rapidly gaining market share — by reviving the issue of unfair government subsidies.

Harry Stonecipher, chief executive of Boeing, who had warned he would raise the rhetoric on subsidies, told the FT: "Just stay tuned ... Airbus is very successful. By their own recent writings they have more market share than we do, they are taking market share every day and they are more profitable than we are. So the question is 'why do they need subsidies?'."

Subsidies have been a recurring theme in the aerospace industry, yet both manufacturers have consistently been unwilling to take action.

In recent months, however, Boeing has intensified its lobbying of U.S. government officials, and Mr. Stonecipher said that he planned to take unspecified action "this year".

He denied that he wanted to take a case to the World Trade Organization, in which the U.S. would seek to have the trade body declare that Airbus was receiving illegal subsidies.

"Trade wars, as they go on and on and on, are not in anybody's best interest ... Probably Airbus's biggest market is the U.S. market, so I don't think they want a trade case and neither do we."

Allan McArtor, chairman of Airbus North America, dismissed the latest remarks. "It appears as if Boeing is trying to create a smokescreen, as they are so far out of bounds with the 1992 [subsidy] agreement with their Washington State production subsidies and with their Japanese financing arrangements."

Mr. Stonecipher said he was "willing to put everything right on the table. Anything. We report on all of our military development stuff that comes in, and we report on it quarterly, officially. Any time anyone wants to lay all the paper out on the table and have the examination, that's fine," he said.

The focus on subsidies comes as Boeing struggles to restore its reputation in Washington, amid a wave of ethics scandals, and to regain its position in commercial aviation. Last year Airbus delivered more aircraft for the first time in its history.

Mr. Stonecipher was confident that the 7E7, its proposed new mid-sized aircraft, would help Boeing regain dominance. "I think it is two to three years for deliveries or orders," he said. "I think orders might go a little faster than that. The 7E7 is getting a great reception around the world."

Mr. Stonecipher expects to remain in the job for another two years, and plans to announce a successor 90 days before his retirement.

"I'll be 70 years old in a couple of years and that seems like it is long enough," he said.

© The Financial Times Ltd 2013. "FT" and "Financial Times" are trademarks of the Financial Times.

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