China blocks Airbus orders over EU carbon price

The Chinese government has held up $12 billion in aircraft orders from Airbus in retaliation for the EU's emissions trading scheme, Airbus says.

China has held up $12 billion in aircraft sales from Airbus over the European Union’s carbon pricing scheme, Airbus said in a call for the EU to reconsider the plan.

Louis Gallois, the CEO of Airbus parent EADS, told a news conference yesterday that Airbus has become a “hostage” to the dispute between the EU and Beijing, which believes Brussels’ emissions-trading system violates national sovereignty by imposing a price on emissions made outside EU territory.

China is among some 25 non-EU countries that have voiced opposition to the scheme. But Beijing has gone further than most, with Chinese regulators blocking the planned sale of 10 Airbus A380s and 35 A330s to Hong Kong Airlines, Airbus says.

“China is putting on hold orders already agreed with airlines but not approved” by regulators, Gallois said. “We are worried that this conflict is becoming a commercial war.”

Gallois urged the EU to reconsider the carbon pricing plan.

“We’re asking the EU to take into account the global opposition of almost every country outside Europe against this scheme,” he said.

The row will test China’s growing ability to influence international trade policy. Airbus now sells roughly 20 per cent of its new aircraft to Chinese airlines.