Only days ago it was far from a foregone conclusion, but the arrival of a Bombardier CSeries flight test vehicle here in Dubai marks the highlight of Bombardier’s presence on the show’s static display line. Taking a break from a frenetic flight test schedule, the CSeries CS100 in the livery of launch customer Swiss International Airlines made the trip to the Middle East from Mirabel, Quebec just as Canadian aviation authorities underwent preparations to award type certification by the end of the year. Bombardier (Chalets A1-A3) has set a first-half 2016 target date for first revenue service with Swiss.
The airplane’s appearance at the show comes just days after the province of Quebec committed to investing $1 billion in the beleaguered program, giving it a 49.5-percent stake in a new limited partnership in which the Canadian company would own the remaining 50.5 percent. According to the company, the sides negotiated the deal “at arms length,” meaning it won’t “materially” affect control of the company.
The new investment by the Quebec government followed a failure by Bombardier and Airbus to reach an agreement over the reported transfer of a stake in the program to the European airframer. Both Bombardier and Airbus confirmed that the two companies had explored “certain business opportunities” together, but neither offered any explicit details of the talks.
During its recent third-quarter earnings call, Bombardier noted it took a $3.2 billion charge related to some two years of CSeries schedule delays.
The agreement between Bombardier and Quebec calls for two equal installments on April 1 and June 30, respectively. As part of the deal, Bombardier has agreed it to maintain all operations and other corporate activities in the province for at least 20 years.
The rescue bid belies Bombardier’s past efforts to dismiss suggestions that it didn’t control sufficient resources to overcome sluggish sales of the airplane and a two-year delay to certification, now scheduled for late this year. Bombardier still hasn’t reached its target of selling 300 CSeries aircraft before scheduled certification. Cost overages and a paucity of order deposits prompted it to raise $3 billion in debt and equity this year and announce plans to sell part of its train business to further boost its balance sheet.
All told, Bombardier recorded a third-quarter loss of $4.9 billion resulting from the CSeries charge and another $1.2 billion charge related to the canceled Learjet 85 program.
Bouncing Back
Still, Bombardier CEO Alain Bellemare struck an upbeat tone in statements released just ahead of the call. “After just a few months, we have strengthened the management team, we have conducted in-depth reviews of our business and have a much clearer picture of what we need to do,” he said. “We are taking the right actions and we have solidified our liquidity position, giving us the confidence to execute our long-term strategic plan.
“This partnership comes at a pivotal time, with the CSeries on the verge of certification. The market is there, our leadership is in place, we have the best product and with the support of the government, we are ready to make this aircraft a commercial success.”
Here in Dubai, other Bombardier products to grace the display line include Abu Dhabi Aviation’s Q400 turboprop, a CRJ900 regional jet from longtime customer Petroleum Air Services, a Learjet 75, a Challenger 350 and a Global 6000 business jet.
