ABSTRACT
This chapter investigates aspects of the trade dispute over Airbus, which at the time of writing in 2005 has led both parties to bring World Trade Organisation (WTO) actions. The Airbus/Boeing competition has existed in the highly politicized world of diplomatic exchanges over the aircraft trade issue. In the US a core element in the dominant political ideology is economic liberalism, which enshrines principles of free trade and laissez-faire. The strategic nature of trade and manufacture in large commercial aircraft was also evident even as early as the late 1970s, when Airbus was aiming to develop its second product, the A310. In the US the nemesis of the number two and three players, McDonnell Douglas and Lockheed, was blamed on Airbus and the subsidy factor. In order to develop the A320 Airbus began looking for finance and potential customers in new environments. In early 1990s there seemed every chance of a trade war between US and EU in commercial aeronautics.
