Airbus shares are trading lower Tuesday morning as the European plane maker has agreed to comply with the World Trade Organisations final ruling on past, illegal EU subsidies.
The news comes as 14-year long row between Airbus and Boeing over fair trading in the plane manufacturing industry, nears an end. It follows a ruling last week in which the WTO confirmed the EU had provided $18 billion in illegal subsidies for Airbus.
By 1115 BST, Airbus shares were 0.54% lower at €100.28. The stock has been moving higher for much of the past four weeks.
Airbus WTO compliance
Airbus said Tuesday that it has “agreed on some amendments to A380 and A350XWB Reimbursable Launch Investment (RLI) loans.”
Airbus has made some changes to the terms of some loans and financial support from the UK, Germany, France and Spain. While the changes haven’t been disclosed, Airbus is clear the new terms are in line with the WTO decision.
“We are confident that we have now achieved full compliance in the DS316 case as a clear demonstration of the will to ensure a fair trade environment respecting international trade agreements,” said Airbus General Counsel, John Harrison.
“Airbus is looking forward to seeing the same constructive attitude and actions of the US and Boeing in the upcoming DS353 case,” Harrison added.
While the WTO has ruled in favour of the US/Boeing complaint, another ruling against US subsidies for Boeing is also expected later this year.
Years long trade dispute coming to an end
While this decision and Airbus’ compliancey don’t mark the end of the trade dispute between the US and EU, it’s a big step towards that.
However, it also paves the way for tariffs on EU imports into the US.
“Today's final ruling sends a clear message: disregard for the rules and illegal subsidies is not tolerated,” said Boeing chairman and CEO Dennis Muilenburg last week when the ruling was announced.
Airbus COE Tom Enders, meanwhile, said the whole story wasn’t yet complete.
“The other half coming out later this year will rule strongly on Boeing’s subsidies and we’ll see then where the balance lies,” Enders said.