Airbus to Lift Plane Output in Alabama to Avoid Trump Tariffs

(Bloomberg) --

Airbus SE will increase jetliner output at its production site in Alabama, boosting volumes of its best-selling narrow-body model and minimizing exposure to U.S. tariffs imposed on Europe-built aircraft.

The company will raise production at the Mobile plant to seven A320-series planes a month by 2021 from five now, helping to lift the global build rate to 63, it said in a statement Thursday. The move, together with existing plans to assemble more smaller A220s, will create 275 extra jobs.

Airbus said it expects to make more than 130 aircraft a year at the southern U.S. factory.

The World Trade Organization in October gave the go-ahead for the U.S. to impose duties on $7.5 billion of European exports in response to the illegal funding for Airbus jets. While tariffs have been levied on planes made in Europe, along with French wine, Italian cheese and Scotch whiskey, they aren’t being applied to components shipped for assembly to Alabama.

The expansion won’t help Airbus avoid duties on wide-body aircraft, which it only makes in Europe.

The company has seven other final assembly lines for A320s in addition to Mobile, four in Hamburg, Germany, two at its headquarters in Toulouse, France, and one in Tianjin in China. A further unit may be added, most likely replacing the A380 superjumbo line in Toulouse that’s earmarked to be shut down.

©2020 Bloomberg L.P.

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