The United States has challenged government aid for Airbus -- which is owned by European firm European Aeronautic, Defense & Space, or EADS -- from Germany, Britain, France and Spain. The European Union in turn has complained U.S. state and local authorities provide assistance to Boeing. The case will soon be handled by the World Trade Organization in what is considered the body's most difficult case yet.

Aside from legal quarrels, both companies are using new technology to fly ahead in the battle: Airbus' most ambitious project is the A380, the world's largest passenger plane -- it holds up to 850 people. Its development cost Airbus roughly $14 billion. With the A380, the Europeans want to win the war against the Americans.

Boeing fired back and earlier last week announced it would revamp its seasoned 747 jumbo jet model.

Boeing once was the undisputed strongman of the game, with a market share near 70 percent in the mid 1990s. But Airbus has since matured, and in 2003 for the first time, it delivered more jet-powered airliners than Boeing. When it comes to the total of in-service planes, however, the U.S. company still is far ahead.

Airbus hopes the A380 can change that -- the plan has sparked an excitement nearly unprecedented in European avionics. Its test landings in Frankfurt and Hamburg, Germany, attracted tens of thousands of onlookers who wanted to catch a first glimpse of the 290-ton giant.

"The first test flights were excellent," Airbus spokesman Tore Prang Friday told United Press International in a telephone interview. "It's more silent and it consumes less fuel than we had expected."

So far, 159 planes have been ordered, with most A380s going to Asian and the Middle Eastern customers. Singapore Airlines wanted to get the first of its ten ordered planes in March, but the airline will have to wait a bit longer.

Airbus had to delay the delivery for at least half a year, aggravating Singapore Airlines and the 15 other customers of the plane. Expected delivery will not come before December 2006, Airbus has announced.

"Our plane is going to fly for 50 years, so six months more or less won't cause us major trouble," Prang said.

But orders for the A380 have stopped despite nearly 400 hours of successful test flying hours. Customers might just want to sit back and see how the delivery situation develops, and just how well the bird performs in day-to-day business.

Fueled by the bad press for rival Airbus, Chicago-based Boeing earlier last week decided it was time to fire back.

The company last Monday announced plans to upgrade its classic 747 jumbo jet from 1969, into a larger 747-8 model. Boeing said it wants to deliver the new planes by 2009.

"The 747-8 will significantly increase the passenger and freighter capabilities of the 747 and offer greater fuel efficiency, improved operating economics, and be more friendly to the environment with reduced noise and emissions," Allan Mulally, Boeing's president and chief executive officer, said in a statement.

But experts say an "upgraded" 747-8 will not impress buyers as much as the new Airbus bird.

"It simply costs too much to develop an entirely new plane. But people on the market will say: That's only half a solution," Ulrich Horstmann, aviation analyst at the Bayerische Landesbank Friday told UPI in a telephone interview. "I don't think the new 747 will stand a chance against the A380 in the jumbo jet passenger sector."

But Boeing has the nose ahead in other weight classes. The Americans argue smaller long-haul aircrafts will dominate the skies of the future, with flexible direct connections playing a major role. Boeing's new 787 Dreamliner is such a plane -- it could fly non-stop from New York to Tokyo.

"The 787 is an excellent model and it looks to be the technological market leader," Horstmann said. So far, 309 Dreamliner planes have been ordered.

Airbus says large-capacity flights between business hubs are the future of air travel, and the A380 could thus disburden the fast-growing airports.

"There are five jumbo jets flying from Johannesburg (South Africa) to London between 8 a.m. and 9 a.m.," Prang said. "Exchanging those 747s to the A380 would hand them 35 percent more seating capacity."

No matter what strategy will succeed, neither of the two companies will have to be worried that the other will go in for the kill, Horstmann said.

"Airbus and Boeing are very sober-minded in their competition. They don't want to defeat each other; after all they're sharing a monopoly with relatively high and stable prices," he said.

Dangerous competition, however, could come from a totally new enemy, he said.

"If the Chinese would start building planes, then we might experience a real threat to both, because there is much room left for plane prices to fall considerably."

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