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The Airbus trade dispute has been a source of friction in US-EC relations since the late 1970s. Airbus Industrie - a group of four European aircraft-makers - has grown to challenge American dominance of the civil aircraft business. However, it has done so in part thanks to generous European government subsidies which, the United States argues, are examples of unfair trade. Yet in spite of its potential for conflict, the Airbus dispute did not cause a trade war and, indeed, the two sides have negotiated a managed trade regime for airliners. How do we explain this cooperative outcome? McGuire examines the dispute and considers the role played by aerospace firms, and international regimes such as the GATT and the transatlantic alliance relationship. Drawing on published sources and interviews with the key players in the dispute, the author asserts that international cooperation must be considered in light of the corporate strategy of globalized firms.
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