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Airbus Industrie G.I.E. (Groupement d'Interet Economique) was founded in 1970 as a company under French corporate law. In the following—where confusion is certain not to occur—“Airbus” will be used to refer to both the company and to the type of aircraft.
The FTC has, though, rejected such speculation: “The national champion argument does not explain today's decision. Our task as enforcers, conferred in clear terms by Congress in enacting the antitrust statutes, is to ensure the vitality of the free market by preventing private actions that may substantially lessen competition or tend to create a monopoly. In the Boeing-McDonnell Douglas matter, the Commission's task was to review a merger between two direct competitors. We do not have the discretion to, authorize anticompetitive but ‘good’ mergers because they may be thought to advance the United States' trade interests. If that were thought to be a wise approach, only Congress could implement it. In any event, the ‘national champion’ argument is almost certainly a delusion. In reality, the best way to boost the United States' exports, address concerns about the balance of trade, and create jobs is to require United States' firms to compete vigorously at home and abroad” (see the majority vote of the FTC, File No. 971-0051).
Cf. O.E. Williamson, Economies as an Antitrust Defense: The Welfare Tradeoffs, American Economic Review, 58 (1968), pp. 18–36.
In addition the FTC took the view that, with reference to the poor prospects for McDonnell Douglas as an independent competitor, the merger almost qualified as a “failing company defense”: “(1) McDonnell Douglas, looking to the future, no longer constitutes a meaningful competitive force in the commercial aircraft market and (2) there is no economically plausible strategy that McDonnell Douglas could follow, either as a stand-alone concern or as a part of another concern, that would change that grim prospect” (see the majority vote of the FTC, op.cit.).
The FTC, too, saw these agreements as not entirely unproblematic in terms of competition: “They represent a sizable portion of airlines that can serve as ‘launch’ customers for aircraft manufacturers, that is, air-lines that can place orders large enough and have sufficient market prestige to serve as the first customer for a new airplane. We intend to monitor the potential anticompetitive effects of these, and any future, long term exclusive contracts” (see the majority vote of the FTC, op. cit.).
The national shares in the development costs of Airbus industrie are distributed as follows: Aerospatiale (F): 37.9%, Deutsche Airbus (D): 37.9%; British Aerospace (GB): 20%; Construcciones Aeronauticas S.A. (E): 4.2%.
Yet it seems that Paris is now no longer opposed to Airbus being converted into a joint-stock company. According to press reports, the French government has opened up the prospect of negotiations on restructuring the consortium for October.
The merger between Daimler-Benz and MBB was intended to be a first step in this direction.
These can be expected only when—as in the case of the B747 Jumbo—the military fields of application are largely in line with those for civilian air transport. Generally speaking the results of military research are of limited value for the civilian segment, as was concluded by the German Monopolies Commission in the context of the Daimler-Benz/MBB merger.
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Haid, A., Hornschild, K. Following the Boeing/McDonnell Douglas merger: Is the air getting thinner for airbus?. Economic Bulletin 34, 3–10 (1997). https://doi.org/10.1007/s10160-997-0007-z
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DOI: https://doi.org/10.1007/s10160-997-0007-z