If ever there was a clearer sign that Boeing and Airbus are worried about Bombardier’s CSeries and will do everything they can to meet the competition and block sales, it’s the news that the US Ex-Im Bank and the European Credit Agencies (ECA) are ditching their “home rule” exclusions for export financing to meet the export financing available to CSeries from the Canadian government.
Here is the story from The Seattle Times as background.
The CSeries has had more than its share of critics for its design, size and slow sales. We’ve written about how these criticisms–mostly from uninformed, biased pseudo-analysts whose agenda is totally transparent–but when the US and European governments step in to protect Airbus and Boeing, it means the two OEMs and their respective governments take the plane seriously.
Airbus officials were clear last year that they feared the CSeries and the launch of the NEO was in direct response to the airplane. Airbus claims the NEO destroys the business case for the CSeries. Our report concludes otherwise, most particularly with respect to the A319neo vs the CS300. The A319neo simply doesn’t have the same economics as the CS300.
As for Boeing, Commercial Airplanes CEO Jim Albaugh said at the Farnborough Air Show that Boeing was then considering boosting production of the 737 so as to not “drive” sales to the CSeries. The 737-700 can’t compete on economics with the CS300, according to AirInsight’s analysis.
Now the US and European governments are stepping up with money to support Airbus and Boeing. Nothing is more telling that in this age of WTO subsidy claims and counter claims, the governments are stepping up to challenge the upstart.
I agree with your analysis. It’s worth pointing out, though, that the US and EU are looking to abolish the home country rule because Canada declined to join in. The home country rule prevents customers in all of the US and the EU getting credit guarantees for either Airbus or Boeing planes. If Canada had joined in, presumably customers in all these areas would be denied credit guarantees for any of Airbus, Boeing or Bombardier planes. That would have been a level playing field, but Canada didn’t sign up.