Talks Center on Aviation Subsidies

The European Union on Thursday demanded that Washington explain more clearly how it subsidizes Boeing Co. and warned it would counter any U.S. challenge targeting EU rival Airbus before the World Trade Organization.

After 4 1/2 hours of negotiations on the transatlantic dispute between the world’s biggest aircraft makers, no clear progress was made beyond identifying stumbling blocks and a promise to keep contacts going in the weeks ahead, officials said.

U.S. negotiator John Veroneau called it a “useful and frank discussion” centering on finding ways to stop new subsidies to the aircraft producers as quickly as possible. He called on the EU “to join us in moving quickly toward that goal.”

“I don’t think trade litigation suits anybody’s interest. I don’t think it would be in Boeing’s interest,” EU trade spokeswoman Arancha Gonzalez said.

Boeing and Airbus compete in civilian and military aircraft markets, and steadily over the last decade Airbus has overtaken Boeing as the world’s biggest aircraft manufacturer.

Both sides agreed in 1992 on a deal that limited subsidies for the world’s two largest airplane makers to 33% of the production costs for new models.

Both sides disagree on what constitutes subsidies, and the EU wants Washington to provide better information, specifically on indirect and sub-federal aid.