Airbus claims to have a commercial edge over its U.S. rival, Boeing

October 19, 1999
Web posted at: 8:50 p.m. EDT (0050 GMT)

From Jerusalem Bureau Chief Walter Rodgers

JERUSALEM (CNN) -- Although Israel has long been the source of a virtual monopoly for aircraft manufacturer Boeing, it is now becoming the latest battleground between the U.S. aviation giant and the European consortium Airbus.

Boeing is pushing to sell its new 777 model to the Israeli national carrier, El Al. But Airbus, which is touting its 330s and 340s, claims to have a commercial edge over its U.S. rival.

"Twice as many airlines, twice as many customers have selected our airplanes as have selected the other one," said Airbus Vice President John Leahy.

But Boeing contends the exact opposite, saying that it is delivering twice as many planes as Airbus.

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CNN's Walter Rodgers looks at the battle for Israel's plane market Windows Media 28K 80K

Neither company is willing to grant the other an inch of the Israeli market.

Washington is backing Boeing's efforts, hoping that Israel's special relationship with the United States will sway El Al's decision in Boeing's favor. U.S. Jewish groups also are quietly urging Israel to buy Boeing or risk angering a U.S. Congress that grants Israel $3 billion a year in aid.

"Obviously the support the U.S. has given Israel over the years and the fact that there is a strong relationship should play a factor," said U.S. Commerce Secretary William Daley.

Statements like that have Europeans crying foul. They say U.S. government pressure on Israel is unfair in an open market. Boeing dismisses that complaint.

"If you want to talk about unfair, they are subsidized by their governments. So where is the unfairness?" asked Boeing Executive Vice President Seddik Belyamani.

Airbus manufacturers admit Boeing might lose jobs if they win Israel's business, but they argue that wouldn't hurt U.S. employment.

"We have 800 American companies building Airbus components. There are 90,000 jobs in the United States involved in building Airbus airplanes," Leahy said.

While the El Al contract -- 3 or 4 planes for about $400 million dollars -- might not seem that large a business deal for such giant corporations, both manufacturers see larger opportunities down the road. The two companies are also seeking further commitments from Israel to buy replacement aircraft in the coming decade -- a deal that could be worth more than $1.5 billion.

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