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Airbus confirms record A320 output hike

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European planemaker Airbus on Wednesday confirmed plans to increase production of its best-selling A320 family of aircraft to a record 42 planes a month, underlining signs of a global economic recovery.
   
The increase consolidates Airbus's position as the world's largest planemaker ahead of Boeing (BA-N) and coincides with a WTO appeal verdict expected later on Wednesday over alleged subsidies which Boeing says bankrolled its rival's success.
   
Boeing and Airbus suffered a slump in orders in 2008 and 2009 amid the recession. Now, demand is reviving as air traffic trends recover and funds flow back into the leasing market.
   
"With a backlog of over 2,300 A320-family aircraft to deliver, we need to increase production to accommodate continuing strong customer demand for these new eco-efficient aircraft," Airbus programmes chief Tom Williams said.
   
The increase, from 36 planes a month now and a previously planned peak of 40 a month which Airbus intends to reach in early 2012, will take place from that year's fourth quarter.
   
EADS last week said it was considering increasing production to meet a rebound in aviation demand led by emerging markets.
   
Industry sources said on Friday Airbus had made the decision internally to lift production to 42 planes a month and was still studying a potential further rise to 44—a level EADS's finance chief has called a "bit of a stretch."
   
The Airbus A320 competes with Boeing's 737 for sales estimated at $1.7 trillion US over the next 20 years. Boeing currently churns out 31.5 737s a month and is aiming to boost production to 38 by the second quarter of 2013.
   
The competing 100-200 seat aircraft are the backbone of most airlines' medium-haul fleets and are credited with powering the dramatic growth of low-cost carriers.
   
Airbus recently announced a new version of its A320 with newer and more efficient engines from 2015, to be known as the A320neo. Boeing is pondering how to respond to the threat.
   
The World Trade Organization is expected to issue an appeal verdict later on Wednesday on whether Airbus received billions of dollars of illegal subsidies.
   
Funds challenged by the United States include government loan payments for development of the A320 from the 1980s, though a more controversial part of the case relates to the recent A380 superjumbo and the future wide-bodied A350.

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