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EU to announce potential tariff counter-measures on

Thursday

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Roughly $100 billion in U.S. imports to be targeted, FT

says

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Airbus and Boeing ( BA ) call for return to duty-free status

(Recasts, adds Airbus and Boeing ( BA ) CEO remarks, context)

By Shivansh Tiwary and Tim Hepher

May 7 (Reuters) - Aerospace companies are preparing for

the next chapter in a new trade war as the European Union draws

up expected counter-measures against Boeing ( BA ) jets in retaliation

for 10% U.S. tariffs on European goods such as Airbus planes,

industry sources said.

The tariffs would mark the first time since 2021 that the

two trade powers, home to the world's dominant planemakers, have

imposed import taxes affecting the $150 billion jet industry.

The European Commission will on Thursday announce details of

its next counter-measures against U.S. tariffs should

negotiations with Washington fail, European Trade Commissioner

Maros Sefcovic said in Singapore on Wednesday.

The Financial Times reported on Wednesday that the European

Union intended to propose tariffs on Boeing ( BA ) jets.

Civil aircraft would be included on a list of roughly $100

billion in annual U.S. imports to be targeted, the FT said,

citing two people familiar with the matter.

Boeing ( BA ) and the European Commission declined comment.

The EU faces U.S. tariffs of 25% on its steel, aluminum and

cars and so-called "reciprocal" tariffs of 10% for almost all

other goods, including aircraft. This could rise to 20% after

U.S. President Donald Trump's 90-day pause expires on July 8.

European carriers have hundreds of jets on order with

Boeing ( BA ), banking on a booming aerospace market, but potential

levies could significantly increase prices of those aircraft.

UNITED FRONT

Industry sources have said the EU is expected to move to

ensure a level playing field on tariffs between Boeing ( BA ) and

Europe's Airbus by retaliating to Washington's levies,

while the industry lobbies in unison to remove all tariffs.

Unlike a previous tariff conflict focused on aviation in

2020 and 2021, European and U.S. aerospace companies have struck

a similar note in calling for a return to a duty-free status and

Boeing ( BA ) and Airbus have not clashed head-on over tariffs.

Airbus CEO Guillaume Faury called last week for a return to

tariff-free trading for aerospace, joining a chorus of U.S.

industry leaders seeking relief from a growing tariff war in

which Airbus warned there could be "only losers".

Speaking earlier this week, Faury said the sequence seen

five years ago, when the U.S. imposed tariffs on Airbus jets,

followed by counter-tariffs from the EU in a pair of World Trade

Organization subsidy cases, had succeeded in leading to a truce.

The aerospace industry has called for a return to a 1979

deal between 33 nations that broadly spared aircraft and parts

from tariffs. Boeing ( BA ) CEO Kelly Ortberg told a Congressional

hearing last month that the planemaker wanted free trade.

Irish carrier Ryanair last week threatened to cancel

orders for hundreds of Boeing ( BA ) jets if a U.S.-led tariff war led

to materially higher prices, implying that it would aim to hold

Boeing ( BA ) contractually responsible for any European retaliation.

The threat by Europe's largest low-cost carrier and one of

Boeing's ( BA ) biggest customers was the latest sign of a potential

reordering of the global aerospace industry if Trump does not

exempt the sector from his tariff plans.

But with the only viable alternative Airbus sold out for the

rest of the decade, and aerospace contracts giving only limited

scope for cancellation, industry sources said Ryanair and other

airlines may find it hard to carry out outright cancellations.

Delta Air Lines ( DAL ) has said it would defer taking

delivery of Airbus aircraft built in Europe if tariffs continue.