Airbus Chief Executive Gustav Humbert said on Friday that US anger over state loans to European planemaker Airbus masked the fact that Airbus still got less state backing than US rival Boeing Co.
"What we want is a level playing field. Our US competitor gets a lot of support, most of which is not even refundable, like tax breaks. This is detrimental to Airbus,"Humbert said at a news conference, a day after Airbus won shareholder approval to start building its mid-sized A350 model.
He appealed to the "wise men" at Boeing to back off from a trade war and refrain from using any support while talks go on.
He said details of European state support would be negotiated in the coming two months, but noted Airbus would be able to fund the A350 out of its own cash or through the usual market channels if needed.
Airbus said Germany, France, the UK and Spain had sent letters of "general support" for the programme, but the company and its shareholders had agreed not to use loans from those governments through 2006 to give the European Union and Washington time to iron out their differences.
That prompted a swift response from the United States, which said it would press ahead with a case against Airbus at the World Trade Organisation because of Airbus's potential use of European state loans.
The US Trade Representative's office said it had filed papers in Geneva to press on with its WTO complaint.
German Chancellor Gerhard Schroeder weighed into the row on Friday, accusing the US of giving huge aid to Boeing, something the US manufacturer denies.
"It simply cannot be that the US government criticises the development loans from European governments to Airbus and at the same time provides massive support to Boeing through generous financial aid from various sources and military contracts," Schroeder said in the text of a speech to be delivered on Friday afternoon.
He said, however, that he was optimistic Europe and the US could create a "level playing field".
In late May, Washington and Brussels reactivated tit-for-tat cases at the WTO over government support for transatlantic rivals Boeing and Airbus.
Industry analysts say it could take the WTO 18 to 24 months to reach a verdict in what threatens to be the biggest trade dispute in the WTO's history. "We continue to believe that a negotiated solution is of such value that it is worth pursuing. We urge America to respond," said Peter Power, a spokesman for European Trade Commissioner Peter Mandelson.
The A350 is designed to compete with Boeing's 787 Dreamliner in the promising market for long-range, twin-engined planes of 200-300 seats that offer cost savings through innovations including more use of lightweight composites.
Airbus sees this as a 3,300-aircraft market over the next 20 years and believes it will split this evenly with Boeing.
Airbus Chief Commercial Officer John Leahy told reporters that despite the debut of the long-range A350, expected in 2010, the shorter-range A330 model would stay in production for at least 10 years.
Some analysts have expressed concerns that the A350 might poach business from the earlier twin-jet model.
Leahy also defended the future of the A340-300, a four-engine plane that the more fuel-efficient, twin-engined A350 threatens to eclipse. He said the A340 model would still be needed for routes such as Singapore to New York, where there are few places to make emergency landings.
Airbus has 140 orders to buy the A350, including 10 from an unnamed airline it expects to identify in coming weeks. It was not able to start firming up the deals until the plane was officially launched, but Leahy told Reuters "all or most" of the 140 orders should be firm sales by end-year.