Bombardier Takes Off with New CSeries Jets
Bombardier Aerospace, the aerospace division of Bombardier Inc, has made significant progress as of late in reaching its target of 300 firm orders. Macquarie AirFinance, an airline leasing firm, has committed to purchasing 40 of the CS300 jetliners, which is excellent news to Bombardier, a company that has been struggling to find operators for its new aircraft. Macquarie AirFinance, an Ireland-based company, leases aircraft to 73 different operators in 43 countries. Should the aircraft be a success, Macquarie AirFinance is expected to exercise an option for an additional 10 aircraft.
News of this commitment resulted in an increase of Bombardier’s stock by 3.7%. Delivery, which will take place between 2017 and 2019, will compose a very large portion of the leasing firm’s new fleet. The new deal is worth around 3.14 billion euros. In total, Bombardier has secured firm orders for 243 CSeries aircraft and has a commitment for orders on a total of 563 aircraft. Talks are also in progress with several Chinese airlines for additional CSeries commitments. This is excellent news for Bombardier, which has been suffering from significant development delays, one of which included an engine fire that halted all test flights. Furthermore, doubt still remains as to whether the company can meet the tentative deadline for early next year. Despite all the setbacks, the company still insists that its new CS300 aircraft boasts several advantages, most importantly the 20% increase in fuel-efficiency as compared to other commercial aircraft. Bombardier is currently in competition with rival Embraer, a Brazilian aerospace company, for third largest global manufacturer behind aerospace giants Boeing and Airbus.
Embraer has had major success with its marketing campaign for its business jets, a strategy coined “right-sizing” by CEO Frederico Fleury Curado. Embraer has been filling the demand for feeder hubs or bypass hubs where smaller aircraft are more cost-efficient, as opposed to Bombardier which is competing directly with traditional airliners that operate Boeing or Airbus jetliners. It certainly has seemed like Embraer was pulling ahead in the race, so news of Bombardier’s new aircraft
deal is definitely well-received among company officials and shareholders alike. Bombardier Inc. is composed of two divisions: aerospace and transportation. In total, the company employs 38,350 people and operates from its headquarters in Quebec, Canada. The aerospace division was formed when Bombardier acquired Canadair in 1986 and turned the failing business around. In 1990, the company then acquired Learjet Company and also de Havilland Aircraft of Canada the following year, all of which contribute aircraft to Bombardier’s current portfolio. The aerospace division now brings in more than 50% of the company’s total revenue. The most popular aircraft are the Dash 8 Series 400, CRJ100/200/440, and CRJ700/900/1000.
Posted on November 19, 2014