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Europe's Airbus to build planes in Mobile, Alabama

Reuters

European planemaker Airbus is to build a factory in the US, taking the fight for market share to the home of its chief rival, Boeing. It believes it can double its American market share and may lower labour costs by opening a plant in anti-union Alabama.

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The new 600-billion-dollar (478-billion-euro) plant will be built in Mobile, Alabama, on the Gulf of Mexico. Alabama is one of several US states that have introduced laws aimed at impeding union organisation.

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The company, which has had an engineering centre at the site since 2007, says it should create up to 1,000 highly skilled jobs and produce between 40 and 50 aircraft by 2018.

Construction should start in summer 2013 and the first deliveries of A320 planes should take place in 2016.

Airbus is based in the southern French city of Toulouse and has a global production network which includes assembly lines in Hamburg, Germany, and Tianjin, China.

Boeing, which is based in Chicago, only builds aircraft in the US, in Washington state and South Carolina.

Airbus says that no jobs will be lost in Europe because of demand that means that both it and Boeing would need years to satisfy current demand.

Boeing raised its 20-year forecast for global demand for airliners by 500 billion dollars (396 billion euros) on Tuesday.

Airbus estimates 4,600 new single-aisle aircraft will be needed in the US over the next 20 years and the new US plant could more than double its share in the huge market.

The European company at present holds about 20 per cent of the US narrow-body market.

The European Aeronautic Defence and Space Company (EADS), of which Airbus is a subsidiary, has been discussing with Alabama for seven years.

The World Trade Organisation has found that both Airbus and Boeing have received subsidies that breach its rules.

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