A-380 Fat in the Butt and Over Budget

[EagleRJ]

"programmes", eh? I guess that's why "it ain't so black and white" to you.

That's just what I was thinking....

For many years the US Government has subsidised Boeing, mainly by paying research and development costs through NASA, the Department of Defence, the Department of Commerce and other government agencies.

Airbus gets exactly the same subsidies, only to a greater degree! Keep in mind that Airbus is actually owned by EADS, which also owns Eurocopter, Ariane, and several other ventures- both civilian and military.

Since 1990, Boeing has also outsourced increasingly large shares of its civil aircraft programmes to other countries, such as Japan (which intends to take 35% in the 7E7 programme, representing government support of around US$ 1.6 billion). The governments of these countries subsidize these shares, such that Boeing’s programs also receive substantial foreign subsidies.

I'm not sure where you're going with this. Airbus outsources too- all over the EU and even in Asia and here in the States. I don't consider that a subsidy. Companies interested in building subassemblies submit bids like in any other project, and the best offer is given the job.

From 2001 to 2003, Boeing has invested only $2.8 billion of its own funds in commercial aircraft R&D and capital expenditure compared to $9.4 billion by Airbus. Lack of R&D and capital investment, has meant that Boeing has not launched any new programmes since 1990!!!

Well, I suppose it's easy to spend money like it's going out of style when your risk is mitigated by the government. Boeing's famous "bet the company" development of the 747 is a prime example when compared to the development of the A380. The 747 turned out to be one of the most successful airliners in history, and a very profitable airplane for Boeing. If the A380 fails to sell in large numbers, will the liquidity of EADS be in jeopardy? I think not.

Let's also consider another Airbus project, the A400 military airlifter. It was supposed to have entered service in 1997, but today it still exists only on paper. After years of cost overruns, technical problems, and partner countries pulling out, Airbus is still forging ahead with it. The RAF has apparently given up on ever getting any, and is taking delivery of Boeing's C-17. With few partner countries still interested, is this project still intended to turn a profit, or is it simply another state subsidy of EADS and its subcontractors? If it looks like a duck and walks like a duck...

 

[Aerosmith]

In addition, Boeing has shareholders not socialist tax payers to be accountable to. Must be nice for Scarebus to spend at will with no regard for the consequences of failure.

Get it through your thick skull. Airbus AND Boeing are subsidized!! Period. Dont be so naive.

 

[Aerosmith]

Airbus gets exactly the same subsidies, only to a greater degree!

So they must be more socialistic than us, eh?

 

[Aerosmith]

For all of you who honestly believes that Boeing does not benefit from subsudies, whether direct or indirect, taxbreaks (payed by taxpayers!!!) etc etc; here is a site for you.


http://www.flat-earth.org/

http://batesmotel.8m.com/http://www.flat-earth.org/

 

[dasmith]

380 sim

Was up in Montreal for sim training and saw the new 380 sim being built by CAE. You heard it here first, it had jetblue's logo on it. ds

 

[Skyboss]

Get it through your thick skull. Airbus AND Boeing are subsidized!! Period. Dont be so naive.

Since you're so sure, give me proof of the Federal Government subsidising loans that do not require repayment until the project breaks even in a Boeing Commercial Aircraft product in the post deregulation era.

This is the kind of subsidy that is simply out of control. No one gives a rat tird about a state, city or county giving a tax break for a hangar or corporate headquarters. It's about the Federal Government vs. the European Government shelling out risk free TENS OF BILLIONS in loans for designing and building new aircraft that don't have to be repaid unless sales break even. If the Government would give Boeing that kind of cash for Direct R&D of Commercial Aircraft they'd launch a whole line of "E" birds from the 737-600 to the 747-400 etc... tomorrow. If Airbus wanted to do this, they could. In fact, they have and if the US Government did, Airbus would be dead. Picture an entire family of aircraft, no wait, Boeing has to spend their own cash meaning it will be 15 years until we see this.

 

[Vik]

Oh thats too funny.

Was up in Montreal for sim training and saw the new 380 sim being built by CAE. You heard it here first, it had jetblue's logo on it. ds

 

[Corona]

Jetstream- with pod.

With a little bit of Hydraulic fluid spewed on the side...

Also, with engine oil streaking back from the fwd engine seal. Makes it look faster.

C

 

[CF34-3B1]

Was up in Montreal for sim training and saw the new 380 sim being built by CAE. You heard it here first, it had jetblue's logo on it. ds

I saw it too. It was right next to the 7E7 sim with the SWA logo on it.

 

[Skyboss]

Those are both hell a funny.

 

[Aerosmith]

Since you're so sure, give me proof of the Federal Government subsidising loans that do not require repayment until the project breaks even in a Boeing Commercial Aircraft product in the post deregulation era.

This is the kind of subsidy that is simply out of control. No one gives a rat tird about a state, city or county giving a tax break for a hangar or corporate headquarters. It's about the Federal Government vs. the European Government shelling out risk free TENS OF BILLIONS in loans for designing and building new aircraft that don't have to be repaid unless sales break even. If the Government would give Boeing that kind of cash for Direct R&D of Commercial Aircraft they'd launch a whole line of "E" birds from the 737-600 to the 747-400 etc... tomorrow. If Airbus wanted to do this, they could. In fact, they have and if the US Government did, Airbus would be dead. Picture an entire family of aircraft, no wait, Boeing has to spend their own cash meaning it will be 15 years until we see this.

You can call it loans, guarantees, subsidies, taxbreaks, grants, State, Federal, Government, DC. Same goal, different tool. It´s all payed by YOU, the taxpayer.Boeing recieved a $3.2 billion tax break for commercial production/ 7E7 production. Stonecipher himself hinted that boeing might forgo some of the tax breaks if Airbus would give up government loans! Kansas' proposed $500 million interest-free bond for Boeing, and government subsidies to Boeing's manufacturing partners in Japan and Italy.The governments of these countries subsidize these shares, so Boeing also recieves substantial forreign aid.

Washington state 7E7 subsidies alone are about as high as European launch investment for the A380. The only difference is that the A380 launch investment is payed back (´92 treaty), while Washington support is not.

Besides this, there is a huge amount of aid in the military division. Because of the security clause in the WTO agreements, Boeing (and others) have used these contracts to offset an often unpredictable civilian market. This clause was also used by Bombardier a few years back.

An example: Morgan Stanley reports that that the 767 tanker recieves a subsidy margin of 9% or $1.6 to $2.3 billion profit for Boeing. This is equivalent to 700 firm deliveries of the 737. Normal profit margin is 6% but Pentagon plans on giving 15%!!

If Boeing had not fattened its bottom line with juicy defence contracts, what would the price of a passenger jet be today? Boeing does not differentiate between the divisions.



Again,. Airbus AND Boeing both recieves subsidies. Dont live in denial about free market and the real world out there.

BTW I love my subsidized 737.

 

[Skyboss]

You still missed my point. It's the loan gurantees. Airbi got tax breaks and loan breaks. The loan breaks allow them to sell the bird at or below cost (example A-318's payments at $88K a month vs an RJ at $97k) because they don't have to worry about anything until they break even. BTW... The 380 got $15 billion in launch loans.

As for the 767... A military contract includes spares, so don't be so inaccurate on the alleged "profit margin" for the flying gas tank, or costs of otehr projects. When the military buys a defense aircraft vs. a conversion aircraft they pay for everything. R&D, personnel and equipment, the whole lot.

 

[Aerosmith]

You still missed my point. It's the loan gurantees. Airbi got tax breaks and loan breaks. The loan breaks allow them to sell the bird at or below cost (example A-318's payments at $88K a month vs an RJ at $97k) because they don't have to worry about anything until they break even. BTW... The 380 got $15 billion in launch loans.

As for the 767... A military contract includes spares, so don't be so inaccurate on the alleged "profit margin" for the flying gas tank, or costs of otehr projects. When the military buys a defense aircraft vs. a conversion aircraft they pay for everything. R&D, personnel and equipment, the whole lot.

Yes, you are correct, Airbus got tax breaks, and SO DID BOEING! Courtesy Washington State (and Kansas, Oklahoma). And their taxpayers. Whats so hard to comprehend here?The Airbus launch loans are be repaid over 17 years (per treaty)
You are also correct, the military pays for everything. Thats what I said. They even pay above market value.

 

[Skyboss]

What Boeing did not get and what you still don't get are the risk free loans.

 

[Aerosmith]

What Boeing did not get and what you still don't get are the risk free loans.

So finally you are admitting that they got something. Good. You are correct about the above. We agree that Airbus gets funded up its a$$. You just wouldn´t admit that Boeing also recieved something. Market economy sometimes has a funy way of showing its colours.

 

[AcroChik]

Accidentally posted twice

.....

 

[AcroChik]

EADS is a Shareholder Owned Company

Just like Boeing, EADS is a publically traded company.

Just like Boeing, the majority of outstanding common shares are owned by institutions, such as investment banks, investment funds, insurance companes, pension funds, etc.

Here is the link to EADS for shareholder information:

http://www.reports.eads.net/eads/ar_2003_en/pages/master.php?id=a_1

If you care to read them, the financial statements of trhe company are availble on that site. It's not terribly hard to extract the numbers that can be construed as subsidy.

Boeing, as an export-critical and defense-critical industry in the US receives special consideration in taxation, legislative acknowledgement and, yes, direct subsidy.

Any tax credit or tax forgiveness or other government action such as legislation that reduces the cost of doing business is a subsidy. All critical defense contractors or economically critical exporters receive the benefits of such programs. Boeing happens to be both.

As an aside, farming is the most highly subsidized industry in America.

Back to the new AIRWHALE:

I haven't been following this story closely, but I am thinking that there is a design-critical relationship between the airplane and the airport gate. That is, they have to mate. A picture I have seen of the Airbus monstrosity seems to show it having two passenger decks with entry / exit on both levels.

Will gates have to be redesigned to accomodate the monster? Will airports be willing to do this? Who pays for this? Will airlines order an airplane that requires gate modification?

Any thoughts?

 

[Skyboss]

So finally you are admitting that they got something. Good. You are correct about the above. We agree that Airbus gets funded up its a$$. You just wouldn´t admit that Boeing also recieved something. Market economy sometimes has a funy way of showing its colours.

Try reading my posts before posting. I've said the same thing all along. I never said Boeing didn't receive anything. Had you read my posts you'd have seen that. You're clearly a bit slow, no doubt a fan of Eurotrash Aircraft. Thanks for finally seeing what I had been saying.