Airbus' public relations people have been faxing their brains out over the weekend, sending out press releases to crow about their victory over Boeing in 2005.

At its annual news conference on Tuesday Airbus said it also led Boeing in deliveries for a third consecutive year, with 378 planes leaving its assembly lines compared with 320 in 2004. Boeing had 290 deliveries after a strike trimmed higher expectations.

Deliveries make up the bulk of Airbus revenues, which rose 10 percent to 22.3 billion euros ($27.1 billion), up from 20.2 billion in 2004. Airbus is 80-percent owned by aerospace group EADS with the rest owned by BAE Systems.

The Airbus order backlog rose to 2,177 aircraft worth $220.3 billion from 1,500 at the end of 2004.

Airbus Chief Executive Gustav Humbert told reporters the return on sales came in at a "ballpark" level of 10 percent, compared with 9 percent in 2004. In 2006, he saw the margin staying beyond 10 percent with continued cost cutting efforts.

Only one problem with this--Boeing made more money.

Humbert also conceded defeat to Boeing in terms of the overall value of jets sold.

He said Airbus's gross orders of 1,111 planes (before cancellations) were worth $95.9 billion and estimated Boeing had taken 55 percent of the total market by value.

He said it was too early, however, to comment on speculation that Airbus would be forced to redesign its slow-selling four-engined A340 to counter the 777's success and that no decisions had been taken.

EADS's shares trade at 15 times forecast 2006 earnings. Boeing, with a bigger chunk of defense income, trades at 21 times, according to Reuters data.

Airbus sold a lot of Chevrolets to Boeing's Cadillacs, a fact buried in the bottom few paragraphs.

I found the story interesting because press releases of this type are designed to talk up the stock, yet all the elements of the story that would interest investors favor Boeing. So what purpose does the press release serve?

Welcome to the world of socialist enterprise, where the political is as important (actually more important) than profit. Airbus like the European Space Program or its announcement of its own GPS satellite network, is all about competing with the U.S. or rather to represent itself as a credible rival economic superpower. Losing to Boeing is a pan-national humiliation and so the PR guys are spinning it to still look like winners.

Notably, not much is said about the A380 that was unveiled with much fanfare last year as "bigger than the 747".

Now Airbus is a profitable and serious competitor, but for how long if its focus is on the symbolic? Even a casual observer of the industry could see that the A380 was a dinosaur the moment it was unveiled--the pattern of air travel and fuel prices make it clear that smaller, more fuel efficient planes are where the market is going.

While not as bad as the Potemkin village antics of the Soviets, the socialist countries of western Europe will always find themselves at a competitive disadvantage as long as they try to mix politics with profit.

Screenpop, a German site, makes my point with the comment

Wir sind schon Weltmeister! Genau genommen Europa und sein Airbus! Ich gratuliere! (We are already world champions! Europe and its Airbus wins)

...and of course in France

Airbus a confirmé sa suprématie en 2005 mais est confronté au retour en force de Boeing (Airbus confirmed its surpremacy in 2005 but is confronted with the return in force of Boeing)