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Abu Dhabi, UAEThursday 21 June 2018

Airbus CEO condemns Brexit, Trump as double protectionist threat

Tom Enders said the UK's exit from the EU will weaken aerospace manufacturing by increasing costs and reducing competitiveness

Airbus chief executive Tom Enders was speaking at an annual dinner of the ADS trade association, which represents aerospace, defence, security and space companies, when he made the comments. Regis Duvignau / Reuters
Airbus chief executive Tom Enders was speaking at an annual dinner of the ADS trade association, which represents aerospace, defence, security and space companies, when he made the comments. Regis Duvignau / Reuters

Airbus chief executive Tom Enders slammed Brexit and US President Donald Trump’s pro-America trade policies as presenting twin threats to its business, while singling out the UK’s vote to leave the European Union as posing the bigger issue.

The developments amount to a “double whammy” of protectionist hazards, Mr Enders said in London at the annual dinner of the ADS trade association, which represents more than 1,000 aerospace, defence, security and space companies.

Brexit will weaken British industry and aerospace manufacturing in particular by increasing costs and curtailing competitiveness, the chief executive said late on Monday. While Airbus will seek to mitigate the impact on its business, “whatever we can do, the net result I’m afraid will be negative", he said.

The Toulouse, France-based company has 25 sites in the United Kingdom, including its main wing design and production facilities, while the wider supply chain extends to 672 sites and more than 5,000 “links or relations” in commercial aviation alone, Mr Enders said.

Though Airbus should be protected from tariffs by an exemption granted to aerospace under World Trade Organisation rules, it desperately requires clarity in areas such as future customs procedures and the movement of employees, according to the executive, who said employees make 80,000 business trips a year between the UK and other EU states.

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Under Mr Trump, the US is “no longer fighting for opening markets but to close the US market to foreign companies and foreign competitors,” with arch-rival Boeing a direct beneficiary, Mr Enders said.

Boeing is “ruthlessly surfing on this ‘America-first’ wave,” he said, citing the import duties imposed on the C Series jet built by Montreal-based Bombardier following complaints from the US company that the model had benefited from illegal state aid.

Labeling the levy to be imposed on US carriers that buy the Canadian plane - in which Airbus has acquired a controlling stake - as “predatory” and “bullying”, Mr Enders said that the move may bring short-term success but will ultimately be self-defeating, adding: “You don’t attack customers.”

Still, “the wreckage that president Trump will leave after four or eight years in the White House might be easier to repair than the UK. exit from European Union", he said.

Airbus earlier revealed that it secured 1,109 jet orders last year, 52 per cent more than in 2016, marking its sixth straight annual sales victory over Boeing. Chief operating officer Fabrice Bregier said the trend means the European company should overhaul its competitor’s lead in aircraft deliveries by 2020.