The British government has agreed to provide a loan of $562 million to Airbus, one of the world's leading commercial aircraft manufacturers to launch its newest long-range widebody aircraft A350 XWB.
British business secretary Mandelson said during his visit to the Airbus plant in Filton, Bristol: ''The deal was excellent news for the UK aerospace sector and for the thousands of British workers within Airbus and its UK-based supply chain".
Mendelson said the government support would guarantee over 1,200 jobs directly and 5,000 thorough Airbus suppliers. Airbus is expected to carry out about 18 per cent share of the work on the new aircraft in UK.
Airbus, the aviation giant is owned by the European Aeronautic Defense and Space Co (EADS), a large European aerospace corporation which is jointly held by Diamler (a German corporation-22.5 per cent), Sogeade (a French holding company-22.5 per cent), and SEPI (a Spanish holding company-5.5 per cent) with 50.5 per cent of the total share capital and the rest 49.5 per cent free float. Airbus produces around half of the world's commercial jet airliners.
The development cost of the new aircraft A350 is estimated at $17 billion and Airbus had sought launch aid to the tune of $5 billion from various supporting governments. Germany and France have recently pledged to invest around $3.6 billion on the project, whereas Spain is still in talks with Airbus regarding its contribution.
The British aid of $562 million is only about half of what Airbus was looking for the works to be done in the units there.