At the Paris Air Show on June 13, 2005, the tails of a Boeing 777, an Airbus A380, and an Airbus A340 were photographed.
LONDON: The United States and the European Union announced Tuesday that they had reached an agreement to suspend tariffs related to the Boeing-Airbus dispute for five years.
“This meeting has started with an aircraft breakthrough,” said European Commission President Ursula von der Leyen, who met with President Joe Biden at a US-EU summit in Brussels. “This truly marks the beginning of a new chapter in our relationship, as we transition from litigation to aircraft cooperation — after 17 years of conflict.”
During a video call on Tuesday, US Trade Representative Katherine Tai stated, “Today’s announcement resolves a longstanding trade irritant in the US-Europe relationship.”
“Rather than fighting one of our closest allies, we are finally banding together against a common threat,” she added, referring to China.
In a joint statement with the EU, she stated that both sides “now have time and space to find a lasting solution through our new Working Group on Aircraft, while saving billions of euros in duties for importers on both sides of the Atlantic.”
Last week, it was reported that the EU was pressuring the Trump administration to reach an agreement to end trade tariffs imposed during the Trump administration in relation to the Airbus and Boeing dispute that arose in 2004.
As part of the agreement, the EU and the US agreed to provide R&D funding through an open and transparent process, as well as to refrain from providing specific support, such as tax breaks, to their own producers that would harm the other side.
The plan is also to work together to address non-market practises by other countries, including China.
The big announcement on Tuesday marked Biden’s first visit to the EU’s headquarters, as well as the first EU-US summit since 2014.
Airbus, which, along with Boeing, dominates the commercial aeroplane market, applauded the agreement, which comes as the manufacturers are regaining their footing following the Covid-19 pandemic.
“Anything that levels the playing field in this highly competitive industry and avoids this terrible lose-lose proposition of tariffs across the Atlantic or across any borders for that matter is good,” said Christian Scherer, Chief Commercial Officer at Airbus, during a press conference on Tuesday. “You don’t have to accept that from Airbus… Just ask our clients.”
Delta Air Lines is a customer of European-made Airbus aircraft, but Airbus has expanded its manufacturing footprint in the United States with its factory in Mobile, Ala., where it manufactures narrow-body jetliners.
“This demonstrates the new spirit of cooperation between the EU and the US, as well as our ability to resolve other issues to our mutual benefit. We can deliver for our citizens and businesses if we work together “The EU’s trade chief, Valdis Dombrovskis, said in a statement on Tuesday.
Trump imposed $7.5 billion in tariffs on European products after the World Trade Organization ruled that the EU had unfairly subsidised Airbus.
Shortly after, the EU imposed $4 billion in tariffs on US products in response to another WTO ruling that said the US had illegally aided Boeing.
Boeing shares were up 0.2 percent in premarket trading on Tuesday morning, while Airbus shares were up 0.5 percent.
Separately, the United Kingdom said on Tuesday that it hoped to reach a similar agreement with the United States in the coming days.
When the dispute arose, the United Kingdom was a member of the European Union, and it was hit by trade tensions that arose during Trump’s presidency.
In March, the EU and the US agreed to a four-month suspension of tariffs as a step toward resolving the long-running trade war.