To justify the subsidies it has received from European governments, the Airbus Company has used all of the following arguments, except

To justify the subsidies it has received from European governments, the Airbus Company has used all of the following arguments, except

The correct answer and explanation is:

The correct answer is “the company needs government support to survive in a competitive global market”.

Airbus, a European aerospace company, has been a recipient of subsidies from European governments, particularly through loans and grants from countries like France, Germany, Spain, and the UK. Over the years, Airbus has provided several justifications for these financial aids to make the case that these subsidies are essential for its operations and growth in the competitive aviation industry. The reasons typically mentioned include:

1. Promoting job creation and economic growth: Airbus has argued that subsidies help protect and create jobs in the European Union. The company provides thousands of highly skilled jobs across the region, contributing to local economies, particularly in areas where its manufacturing and assembly plants are located. These jobs support not only the aviation industry but also related sectors such as research, development, and engineering.
2. Enhancing technological innovation: Airbus claims that subsidies enable it to invest in cutting-edge research and technological development. Developing new aircraft models like the A350 and A320neo requires significant financial resources, and government assistance helps make these investments feasible. Innovation is key in the aerospace sector, where technological advancements can give companies a competitive edge.
3. Maintaining strategic industry leadership: Airbus emphasizes the importance of maintaining a strong and competitive European aerospace industry in the face of global competition, especially from U.S.-based companies like Boeing. With the scale and resources required for aircraft production, Airbus contends that government support is crucial for ensuring the long-term viability of the company and, by extension, Europe’s aerospace sector.

However, one argument not used by Airbus to justify these subsidies is that the company “needs government support to survive in a competitive global market.” While Airbus might highlight the competitive challenges it faces, it generally does not present itself as unable to survive without such support. Instead, the focus is on how government assistance helps Airbus stay competitive in the market by enabling growth, innovation, and job creation.