Europe's Airbus A380 will be the largest passenger jet in the world

European negotiators are keen to avert a possible economic showdown at the World Trade Organisation (WTO).

Both sides have missed an 11 April deadline to reach an accord on cutting support to Airbus and Boeing.

The EU and US accuse each other of boosting their industries with illegal state subsidies.

However, both have expressed a willingness to negotiate beyond Monday's deadline.

Standing ready

EU negotiators said there was still a period of weeks to reach a deal with Washington in order to prevent the issue going to the WTO.

Boeing hopes to counter Airbus with its mid-sized 787 Dreamliner

"I stand ready to continue negotiation," said EU Trade Commissioner Peter Mandelson.

"The EU remains interested in reaching an initial agreement that reduces the levels of government support in this sector and completing a comprehensive agreement in the longer term," he said.

The dispute between the two sides intensified after Airbus started producing what will become the world's largest passenger plane, the A380 superjumbo.

Fresh aid

The US accuses the EU of having funded the project with generous subsidies, while the EU claims that Boeing is receiving similar help in the US for its mid-sized 7E7, now 787 Dreamliner plane.

On 11 January, the US government and EU gave themselves 90 days to resolve their dispute over aircraft subsidies instead of suing each other through the WTO.

However, time remains tight for a negotiated settlement, as Monday's deadline ends a standstill agreement between the EU and US on fresh subsidies to their airline makers.

Airbus is expected to seek about $1.6bn (1.2bn euros; �848m) in European state aid for the launch of its proposed A350 passenger jet, which would rival Boeing's Dreamliner.

Such a move would probably lead the US to take legal action at the WTO, if an agreement is not reached beforehand.

Korean Air, South Korea's biggest carrier, announced on Monday that it has signed a deal to buy 10 Boeing 787 Dreamliner plans for $1.3bn.