Each of these government leaders had one thing in common: they were trying to decide whether to buy billions of dollars’ worth of commercial jets from Boeing or its European competitor, Airbus. And United States diplomats were acting like marketing agents, offering deals to heads of state and airline executives whose decisions could be influenced by price, performance and, as with all finicky customers with plenty to spend, perks.
This is the high-stakes, international bazaar for large commercial jets, where tens of billions of dollars are on the line, along with hundreds of thousands of high-paying jobs. At its heart, it is a wrestling match fought daily by executives at two giant companies, Boeing and Airbus, in which each controls about half of the global market for such planes.
To a greater degree than previously known, diplomats are a big part of the sales force, according to hundreds of cables released by WikiLeaks, which describe politicking and cajoling at the highest levels.
It is not surprising that the United States helps American companies doing business abroad, given that each sale is worth thousands of jobs and that their foreign competitors do the same. But like the other WikiLeaks cables, these offer a remarkably detailed look at what had previously been only glimpsed — in this case, the sales war between American diplomats and their European counterparts.
The cables describe letters from presidents, state visits as bargaining chits and a number of leaders making big purchases based, at least in part, on how much the companies will dress up private planes.
The documents also suggest that demands for bribes, or at least payment to suspicious intermediaries who offer to serve as “agents,” still take place. Boeing says it is committed to avoiding any such corrupt practices.
State Department and Boeing officials, in interviews last month, acknowledged the important role the United States government plays in helping them sell commercial airplanes, despite a trade agreement signed by the United States and European leaders three decades ago intended to remove international politics from the process.
The United States economy, said Robert D. Hormats, under secretary for economic affairs at the State Department, increasingly relies upon exports to the fast-growing developing world — nations like China and India, as well as those in Latin America and the Middle East.
So pushing sales of big-ticket items like commercial jets, earth-moving equipment or power plants (or stepping in to object if an American company is not being given a fair chance to bid) is central to the Obama administration’s strategy to help the nation recover from the recession.
Boeing earns about 70 percent of its commercial plane sales from foreign buyers, and is the single biggest exporter of manufactured goods in the United States. Every $1 billion in sales — and some of these deals carry a price tag of as high as $10 billion — translates into an estimated 11,000 American jobs, according to the State Department.
The Equalizers
“That is the reality of the 21st century; governments are playing a greater role in supporting their companies, and we need to do the same thing,” Mr. Hormats, a former top executive at Goldman Sachs, said in an interview.
Said Tim Neale, a Boeing spokesman, “The way I look at it, it levels the playing field.”
But Charles A. Hamilton, a former Defense Department official who is a consultant to Airbus, said the government’s advocacy undermined arguments by Boeing and the United States that Airbus had an unfair advantage because of its subsidies from European governments. “The bottom line is anything goes to get the business,” said Mr. Hamilton, adding that he was speaking for himself, and not for Airbus. “If they feel like they are losing, they will do just about anything to save a deal.”
Airbus executives would not discuss details of their own sales campaigns — and the WikiLeaks documents are mostly focused on American efforts. But one Airbus official, who was not authorized to speak on the record, conceded that, international agreements aside, “commercial jet sales are not totally decoupled from political relationship building.”
One example of the horse-trading involved Saudi Arabia, which in November announced a deal with Boeing to buy 12 777-300ER airliners, with options for 10 more, a transaction worth more than $3.3 billion at list prices. That announcement was preceded by years of intense lobbying by American officials. One pitch came from the highest levels, the cables show. In late 2006, Israel Hernandez, a senior Commerce Department official, hand-delivered a personal letter from President George W. Bush to the Jeddah office of King Abdullah, urging the king to buy as many as 43 Boeing jets to modernize Saudi Arabian Airlines and 13 jets for the Saudi royal fleet, which serves the extended royal family.
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