U.S. Export-Import Bank Chairman Fred Hochberg defended backing Boeing Co. (BA:US) after Delta Air Lines Inc. (DAL:US) sought to block the lender’s financing for foreign carriers that buy the manufacturer’s planes.
Airlines “have a choice, they can fly Boeing-built airplanes or Airbus-built airplanes,” Hochberg said today in an interview in Washington, referring to Boeing’s European competitor. “We’re not going to stand down and step back and put U.S. jobs at jeopardy.”
Hochberg declined to comment on a lawsuit Delta filed yesterday in federal court in Washington to block more than $100 million in loan guarantees for carriers including Emirates Airlines and Korean Air Lines Co. (003490) to buy Boeing aircraft. Atlanta-based Delta, joined by Hawaiian Airlines Inc. and the Air Line Pilots Association, said the bank didn’t properly analyze the impact on U.S. jobs of financing foreign competitors.
The lender, which provides assistance to purchases of U.S. products by foreign entities, survived a lobbying campaign last year to end its authorization. The bank’s charter expires in September 2014, setting the stage for another debate.
Domestic carriers led by Delta have said the Export-Import Bank supports foreign competitors at the expense of the U.S. airline industry. Opponents such as the Club for Growth, which favors smaller government, have said the lender meddles in private enterprise.
Hochberg, who is hosting the bank’s annual conference in Washington, has rebuffed the criticism, saying the bank helps U.S. exporters deal with competitors backed by foreign governments.
Congress last year raised the Export-Import bank’s lending limit to $140 billion through September 2014. While the bank has authorized $110 billion in export financing, Hochberg said he isn’t concerned about breaching the cap before the charter expires because loans are continuously repaid.
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