From: Reuters
Published April 22, 2008 09:14 AM

Airbus sees no negotiated settlement with Boeing

By Jonathan Lynn

GENEVA (Reuters) - European planemaker Airbus does not expect an early resolution of its disputes about state aid with U.S. rival Boeing, even though the two will work together to promote better air traffic control, it said on Tuesday.

The European Union and the United States are pursuing competing complaints at the World Trade Organisation (WTO) over tens of billions of euros and dollars in state support provided to Boeing <BA.N> and Airbus, a unit of EADS <EAD.PA>.

Airbus CEO Tom Enders said that while he expects the WTO to rule on the two cases later this year, a negotiated settlement with Boeing was unlikely before then.

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Airbus had made a couple of approaches to suggest negotiations but they had not been fruitful, he said.

"I still believe that a really sustainable solution has to be negotiated," he told Reuters.

Relations were further strained when the U.S. Air Force awarded a $35 billion contract earlier this year for aerial refueling tankers to Northrop Grumman Corp. <NOC.N> and EADS rather than Boeing.

Enders was speaking after signing an agreement with Scott Carson, CEO of Boeing Commercial Airplanes, to cooperate to improve global air traffic control systems.

Both Enders and Carson told an earlier news conference the two companies would continue to compete aggressively in making and marketing planes. But just as they already cooperated on safety, the two now saw the potential to cooperate on the environment.

The aviation industry is fast approaching a crisis because of congestion in the United States and Europe, Enders said.

A state-of-the-art air traffic management system in Europe would allow the industry to save 10-12 percent of fuel consumption in a few years, he said. This work would not be restricted to planemakers but involve other sectors such as electronics, the two noted.

"We will also collaborate in areas to improve the overall environmental performance of the aviation industry," Boeing spokesman Charlie Miller said.

Enders said this cooperation would involve both companies working with their suppliers -- whom they share in many cases -- so that they understand how they can improve their environmental performance.

(Editing by David Cowell)

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