European Union should stop supporting Airbus Essay

European Union should stop supporting Airbus - Essay Example with manufacturing costs, the company has managed to grow its market share and improve its manufacturing to the point where Boeing now claims dominance in market share and revenues worldwide. Airbus has taken in over US$13 billion in subsidies since its founding, yet the company continues to ask its government shareholders for more subsidies to continue to compete against its rival. Subsidies cost the European taxpayer, and support the airlines which buy planes. Each Euro which is taken from European taxpayers could be better employed by direct consumption or investment in private enterprise, which would result in the application of market reasoning to funds usage. The reasoning used to support Airbus is the same as the Common Agricultural Policy—that farmers (or aircraft employees) cannot be competitive on their own, and need to have subsidisation in order to maintain employment and compete on world markets. The reasoning used by both is the same: both are â€Å"bridge† financings, and should not have to be made all the time, just during an ‘adjustment period.’ In fact, Airbus, as with European farmers, has grown used to government subsidisation, and has not adjusted its policies to improve its competitive position. Governments justify their continuing support in Airbus on the basis of the number of jobs created or maintained. They do not mention the opportunity cost of employing that capital in other industries, or of giving investors the capital in order to make rational business decisions. The governments of Germany and France, far from aiding Airbus and its ability to compete with Boeing, have placed conditions which make it impossible for the company to be as cost- or capital-effective as the company from Chicago. Boeing has been able to accelerate development and production of its 777 and 787 aircraft by seeking the best industrial partners from around the world. It has thus reduced its own capital requirements in new models by off-loading