Here we go again. Another day, another World Trade Organization decision … and another bit of bad news for Boeing
As you may recall, Boeing and Airbus have been dueling recently over the issue of airplane subsidies. Boeing accuses Airbus of taking illegal subsidies from European governments to help "launch" several plane models. Airbus counters that Boeing gets similar aid from the U.S. in the form of defense and space contracts. Last year, Boeing won a "landmark" judgment against Airbus, followed by Airbus notching a smaller victory a few months later. But if you thought those verdicts ended the dispute, you've obviously never met a lawyer.
Already, Airbus is crowing over an appeal of its verdict, which went largely in its favor last night. While reiterating its conclusion that Airbus took billions of dollars in "launch aid" from its Euro-sponsors, the WTO seems to have changed its mind about Airbus accepting illegal "export subsidies."
Boeing is doing its best to spin the news, insisting that Airbus's subsidies are bigger than its own. If Boeing was wrong to accept U.S. government handouts, then Airbus was at least more wrong. But Airbus is feeling its oats, and says it has no intention of turning down a $5 billion loan package now being negotiated to help it get the new A350 airliner off the ground.
So this is bad news for America, right?
You might think so. After all, in addition to Boeing, Honeywell
With everything still "up in the air" (so to speak), I see little chance Airbus or Boeing will willingly decline state support. With economies teetering in America and Europe, there's even less likelihood governments will voluntarily cut support and send thousands of high-paying aerospace jobs overseas to a rival.
My take: The litigation will continue. The lawyers will keep racking up billable hours. And so on, ad infinitum. There's just no incentive to do different for any of the parties involved.
Suffering from insomnia? Add Boeing to your Watchlist, and ensure a steady supply of reading material as this legal drama drags on.
Fool contributor Rich Smith has no position in any company named above. The Motley Fool has a disclosure policy. Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.