Airbus battles Boeing in its own backyard

AIRBUS has been invited to build a £1bn factory in its arch-rival Boeing's backyard. The extraordinary invitation to EADS, the European defence giant that owns Airbus, has come from cities in Washington state, the traditional heartland of Boeing, the world's largest aircraft manufacturer.

The cheeky invitation has angered Boeing executives. It would be the equivalent of Boeing setting up a factory in Airbus's home town of Toulouse in France.

A Boeing source said: 'This is just a stunt. It will never happen.' But a spokesman for the European company said: 'Airbus or any company is at liberty to go and engage with the state of Washington.'

What makes the invitation even more humiliating for Boeing is that Airbus wants the factory to assemble military airtankers. Boeing has been the main supplier of military tankers to the US armed forces for 40 years. But a recent scandal over tendering has forced the Pentagon to cancel a Boeing order for tankers and Airbus is hoping to join the bidding for a multi-billion dollar contract second time around.

BAE Systems has a 20% stake in Airbus, so any order from the US military will be welcomed at its factory in Broughton, Clwyd, which makes the airtankers' wings.

Under plans being considered by Airbus, the tankers would be flown to America, where they would be customised for the US military.

On Tuesday, state officials and representatives from the cities of Port of Moses Lake and Spokane will be in Washington DC to hear Airbus talk about its plans to set up a factory in the US that will create more than 1,000 jobs and make billions of pounds worth of planes and parts.

Albert Anderson, industrial development manager at Port of Moses Lake, said: 'We know this is Boeing country, but if Airbus is going to build something in the US anyway, why not Moses Lake?'

Michelle Zahrly of the Washington State Department of Community, Trade and Economic Development said: 'We want to be a centre for aerospace and there are more companies around than Boeing.'

An EADS spokesman said: 'The chief criteria are a good runway and skilled workers. Washington state sounds a good place.'