Report: U.S. aerospace industry suffering in light of EU funding
U.S. manufacturers of large civil aircraft have lost significant market share over the past 25 years to their European competitors, according to a report published by the U.S. Department of Commerce, as the tit-for-tat argument concerning government aid continues.
The report highlights that the U.S. aerospace industry workforce has been cut nearly in half since 1990, from 1.12 million to 606,000 today.
In the last few years Airbus has overtaken Boeing as the world’s largest aircraft manufacturer, and has recently started testing on its A380 super jumbo jet. Last year the U.S. government called upon European governments to cease providing launch aid to Airbus, arguing that it is now an established company that no longer requires state aid for research, development and marketing.
The dispute intensified in October 2004 when the United States filed a challenge with the World Trade Organization and terminated the 1992 trade agreement permitting limited subsidies to commercial aircraft producers. The EU retaliated with an action against U.S. support of Boeing.
According to the Commerce report, there is a marked difference in the nature of government funding between the EU and the United States, with the European approach targeted at more specific commercial products, while the U.S. approach relies on more general, basic research that advances the science of flight, essentially pre-competitive in nature.
Competition, regulation and global market factors affecting U.S. aircraft manufacturers will be the topic of a Congressional hearing on Wednesday.
The hearing by the U.S. House Subcommittee on Aviation, chaired by U.S. Rep. John Mica is scheduled to begin at 10 a.m. in 2167 Rayburn House Office Building. A live Web cast of the hearing will be available at the committee’s Web site: http://www.house.gov/transportation .