Wednesday, the Trump Administration announced that it will not impose tariffs on component parts imported to Airbus Mobile’s facilities. U.S. Senator Doug Jones, D-Alabama, welcomed the news and said that the tariffs “would have caused unnecessary harm to Alabama workers.”
“Tariffs on Airbus’ Mobile production lines would have caused unnecessary harm to Alabama workers and would have created a domino effect for the American airlines that rely on their product,” Sen. Jones said. “I’m relieved that the Administration has decided not to impose tariffs on European-made parts used in the Mobile Airbus assembly facility. However, I urge the President to reconsider issuing broad and costly new tariffs on other goods from our allies in Europe, especially at this time when we should be looking for ways to strengthen both those diplomatic relationships and the global economy.”
European governments are angry after the Trump administration announced tariffs on a host of European products and are vowing to retaliate.
On Wednesday, the World Trade Organization ruled that the United States could impose the tariffs as retaliation for illegal aid that the 28-country EU gave to Airbus in its competition with its American rival U.S. based Boeing. The U.S. has been in a trade fight for the last 15 years over the EU’s subsidizing of Airbus.
The administration has imposed a ten percent tariff on new Airbus planes as well as helicopters imported into the U.S. The administration has also imposed a 25 percent tariff on European dairy products, wine, and whiskey.
President Donald J. Trump called the WTO ruling a “big win for the United States” and asserted that it happened because WTO officials “want to make sure I’m happy.”
“The WTO has been much better to us since I’ve been president because they understand they can’t get away with what they’ve been getting away with for so many years, which is ripping off the United States,” Trump said,
The move is the latest escalation in a growing global trade war. The move heighten fears among economists that a global economic shutdown could result. Stocks have fallen this week due to the tariff news as well as reports that American manufacturing is slowing down as well. The Trump’s trade war with China is reportedly weighing heavily on businesses including manufacturers.
The tariffs are set to go into effect on October 18.
The EU’s top trade official said the bloc would prefer to reaching a deal with the United States to avoid a tariff war.
EU Trade Commissioner Cecilia Malmstrom said a tariff war “would only inflict damage on businesses and citizens on both sides of the Atlantic, and harm global trade and the broader aviation industry at a sensitive time.”
“If the U.S. decides to impose WTO authorized countermeasures, it will be pushing the EU into a situation where we will have no other option than to do the same,” she said.
Italian Foreign Minister Luigi Di Maio vowed to “defend our businesses.”
Italian wine and cheeses would be impacted from the U.S. tariffs.
The WTO has ruled that European support for the launch of Airbus cost Boeing sales of the 747 and 787.
Airbus assembles jetliners at the Brookley Aeroplex in Mobile. The parts however are mostly made overseas in Europeans countries, including Great Britain, Germany, and France. A tariff on those parts would substantially raise the price of producing airplanes in Mobile. Problem with Boeing’s new 737 Max planes, have only accelerated demand for the Airbus A320 and A220. All of Airbus’s global factories are running at 100 percent capacity to try to reduce the backlog of thousands of aircraft that have been ordered from the European aviation giant.
FliegetFaus, a Canadian aerospace industry publication, is reporting that Airbus is considering adding a third production line in Mobile to try to deal with the enormous demand for the product. Mobile is currently producing four A320 airplanes a month. When the second line producing A220 airliners comes online that will rise to ten airplanes a month. A proposed third production line could increase that to 15 to as much as 20 aircraft a month dramatically increasing the number of aviation jobs in Mobile.
Wednesday’s decision by the Trump Administration not to impose tariffs on aviation parts destined for Mobile increases the likelihood that Airbus will add that proposed third production line at Brookley.
Senator Jones has been a vocal critic of the Trump Administration’s trade policies. He seeks reelection next year.
The major party primaries will be on March 3.
Original reporting by the Alabama Media Group, Time, and Bamapolitics’ David Preston contributed to this report.
