Bombardier Inc. (BBD/B)’s embattled CSeries jet got a boost as a U.K. lessor said it would buy as many of 24 of the planes, which were grounded after an engine blowout and have struggled to win orders.
Falko Regional Aircraft Ltd. signed two letters of intent for the purchase of the smaller, CS100 variant, according to a statement released yesterday. The companies gave no schedule for a firm order for the jets, whose $63 million list price would mean a sale with a maximum value of about $1.51 billion.
The accord hands Montreal-based Bombardier a rare public-relations victory for a model that won’t appear at the Farnborough International Airshow starting tomorrow in England, this year’s biggest aviation expo. An engine caught fire during a ground trial in May, spurring the planemaker to park its test fleet while trying to meet a delayed 2015 commercial debut.
“We are pleased to take the first step towards adding Bombardier’s state-of-the-art CS100 aircraft,” said Mark Hughes, executive vice president for corporate finance at Hatfield, England-based Falko.
Bombardier’s 203 CSeries orders are short of the target of 300 by the time the jet enters service. The plane is the centerpiece of aerospace growth plans this decade at the maker of regional jets, business aircraft and turboprops. While Bombardier bills the CSeries as a challenger to single-aisle models from Boeing Co. (BA) and Airbus Group NV (AIR), only one of the world’s 20 largest airlines by traffic has ordered the plane.
Falco’s order was welcome news for Bombardier.
“This is a lessor that understands the marketplace and understands what their customers want,” Rod Sheridan, Bombardier’s vice president of sales and asset management, said in an interview in Farnborough.
Falko was formed in 2011, according to yesterday’s statement. The company said it placed Bombardier regional jets with Mesa Airlines Inc. in the U.S. and Slovenia’s Adria Airways and also has acquired Q400 turboprops on lease to Croatia Airlines.
The CSeries’s May 29 engine fire added to the program’s setbacks, which include multiple delays and rising costs. Bombardier said July 10 it expects to resume flight trials “in the next few weeks.”
To contact the editors responsible for this story: Ed Dufner at email@example.com Stephen West