- C Series is gaining attention of global carriers, Cromer says
- Planemaker expects to double deliveries of the jet next year
Bombardier Inc. is targeting a major European aircraft order as the next step in the recovery of its C Series program following a $5.6 billion sale to Delta Air Lines Inc. that helped turn around the jetliner’s prospects.
The Canadian planemaker expects a “strong second half of the year” for its marquee jet, which is more than two years late and at least $2 billion over budget, said Fred Cromer, the company’s president of commercial aircraft. The C Series has logged 127 orders this year, including 75 to Delta in April.
“We’re gaining the attention of airlines in every region,” Cromer said Monday in an interview at the Farnborough Air Show in the U.K. “A European carrier, a large European carrier, would be good.”
The company will deliver 15 C Series planes this year and about double that number in 2017, Cromer said. Swiss International will become the first operator of the aircraft when it flies a CS100 model to Paris on July 15. The Deutsche Lufthansa AG unit will receive 29 other C Series jets through 2018.
Bombardier has made progress in recent months to shore up finances and demonstrate that the C Series has a long-term future. Besides receiving $1 billion in investment in the program from the province of Quebec, the Montreal-based company sealed the deal with Delta and landed firm orders from customers including Air Canada.
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Bombardier is working with suppliers to bring down costs as it prepares to make more C Series planes. Even by 2020, output is projected to be less than one fifth the production rates for competing workhorse jets at Boeing Co. and Airbus Group SE.
“What’s next is to try and get additional deals and continue to build the order book, but we have to manage the ramp-up as well,” Cromer said.
Latvia’s Air Baltic Corp., which is poised to become the first operator of the larger CS300 later this year, will consider C Series jets to replace its Bombardier Q400 turboprops, Chief Executive Officer Martin Gauss told reporters Tuesday in Farnborough. The carrier’s fleet includes 12 Q400s, which will need to be replaced in about six years, Gauss said.
Bombardier’s recent financial moves have provided the “flexibility to sit back, reassess the market, push the aircraft’s superior economics and passenger comforts, and attempt to improve the economics in future orders,” said Fadi Chamoun, a BMO Capital Markets analyst. He attended a presentation Monday by Bombardier executives in Farnborough including Chief Financial Officer John Di Bert.
“The C Series program currently has good visibility into production ramp-up through the next several years,” Chamoun said in a note.
In a C Series jet shown in Farnborough, Bombardier used visual displays to highlight the plane’s larger windows compared with an Airbus A320neo, and a bigger cabin than that of the Embraer SA E2.
The Brazilian planemaker, Bombardier’s biggest competitor in regional jets, has threatened to file a complaint with the World Trade Organization because of the investment by the Quebec government, saying the cash injection is enabling its Canadian rival to undercut market pricing.
Cromer said the province was “just an equity investor like any other equity investor.” He said there was “desire on both sides” to reach a similar deal with Canada’s federal government.
One of the key figures in determining Canada’s potential C Series funding is Navdeep Bains, Canada’s Innovation Minister and the government’s point person in talks with Bombardier over financial aid. He stopped by Farnborough on Monday to renew discussions with the manufacturer and see the plane.
While saying he had a “great meeting” with Bombardier CEO Alain Bellemare, Bains declined to elaborate on whether they made progress in talks that had reportedly stalled. The key issues under discussion include the company’s headquarters, jobs and commitment to research and development, Bains said in an interview at the air show.
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“We’re taking it very seriously,” he said. “We believe in the company and want to be part of the solution.”