BERLIN: Germany has agreed to pay Airbus €623 million ($690 million) in loans from Germany for the new Airbus A350 widebody jet, a spokeswoman for the economics ministry said.
The move was expected after Airbus Chief Executive Tom Enders said a deal was pending, when the company announced full-year results in Munich. An Airbus spokesman said Wednesday that the company welcomes the agreement. The loan runs until 2031 and up to 1,500 deliveries, the ministry said.
Talks between Airbus and Berlin on the second loan broke down ahead of federal elections in Germany in 2013 amid acrimony between the company and the government over guaranteed work and jobs.
According to the ministry spokeswoman, the two parties came to agreement late last year, and Germany’s parliamentary budget committee approved the payment on Wednesday.
Airbus, the commercial aerospace unit of Airbus Group NV , has received billions of euros in preferential loans from European governments to support the development of new jetliner models over the past four decades. That included an initial €500 million loan from Germany for the A350. The process on agreeing a second loan, for €623 million, proved protracted because Airbus Group, formerly European Aeronautic Defence & Space Co., balked at the terms demanded by the German government.
The issue of loans for new planes has been controversial as the U.S. and Europe battle at the World Trade Organization over subsidies given to their respective plane makers. The WTO has said both Boeing Co. and Airbus have received subsidies not compliant with international trade agreements.
