5 ms·
I don't think this is inconsistent at all. They're laying off mostly people in their rail division, which is based in Germany and doing poorly. They're asking f
by gok 10y ago
I don't think this is inconsistent at all. They're laying off mostly people in their rail division, which is based in Germany and doing poorly. They're asking for some government support for the aerospace group, which is based in Canada and doing ok, but facing lots of competition from Airbus and Embraer, which also receive government support.
- bogomipz 10y ago>", but facing lots of competition from Airbus and Embraer, which also receive government support." Do you mean Canadian government support? Not US?
- cheriot 10y agoAirbus is European and Embraer is Brazilian. Airbus even lost a WTO case over illegal subsidies.
- bogomipz 10y agoSure, I was just curious if someone US money was funneling to the EU in some circuitous fashion. Airbus is France and German y correct?
- zorked 10y agoPresumably from European governments in the case of Airbus and from the Brazilian government in the case of Embraer. In the late 1990's Embraer and Bombardier sued each other in the WTO which found both governments guilty of subsidies. Embraer is preparing to sue Bombardier/Canada again: http://www.reuters.com/article/embraer-bombardier-idUSL2N18D1JR?type=companyNews http://www.reuters.com/article/embraer-bombardier-idUSL2N18D...
- tormeh 10y agoI wonder why governments subsidize production of commercial airliners so much. There are no network effects or lock-in, so there is nothing to milk after you've gotten big, just more need for subsidies. And jet fighters etc. are usually made by different manufacturers altogether, except for military freighters.
- alistairSH 10y agoNational pride. Looks good to constituents (high paying, high-tech blue collar jobs). Profit (assuming Boeing eventually pays more in taxes than the value of the subsidies)
- gok 10y agoEr, there are huge network effects and lock-in. Maintenance and type certification mean that pilots and mechanics get locked into your type. That in turn means that airlines tend to try to buy from as few manufacturers as possible, so as they grow they're more likely to buy from the manufacturer they bought from last time. There are of course self-sufficiency reasons too. If the West put an embargo in place against China for airliners, they'd be SOL. This is why they're trying to hard to make their own planes (and perhaps more importantly, engines).
- karmelapple 10y agoJobs. The amount of people and documentation required to develop anything FAA-certified is enormous.
- jomamaxx 10y ago"I wonder why governments subsidize production of commercial airliners so much. There are no network effects or lock-in" Huge lock-in :) Aircraft manufacturers are all semi-nationalized they are 'too big' even for private capital to compete on - barriers to entry far too high and too much risk. Airbus is literally an EU creation. Boeing lives on defence contracts. So it needs 'a national team playing for it' kind of thing. There are a lot of jobs, it's very long term, it's big money, involves a lot of tech and R&D so it's a good industry to have if you can get it going. But it doesn't get going without playing 'home team'.