Bombardier wins large C Series order from Air Canada
Air Canada will become the first North American mainline, international network carrier for the C Series family of aircraft. Based on the list price of the CS300 aircraft, a firm order for 45 would be valued at approximately $3.8 billion US.
At a press conference that was held yesterday in Saint-Laurent, Québec, Calin Rovinescu, President and Chief Executive Officer, Air Canada, along with members of his leadership team comprised of Benjamin Smith, President, Passenger Airlines and Michael Rousseau, Executive Vice-President and Chief Financial Officer were hosted by Alain Bellemare, President and Chief Executive Officer, Bombardier Inc. Alongside Mr. Bellemare to celebrate the signature, which opens a new chapter in the partnership between the two companies, were his colleagues from Bombardier Commercial Aircraft, Fred Cromer, President and Rob Dewar, Vice President, C Series Aircraft Program and members of their leadership teams.
"We've been carefully assessing the capabilities of Bombardier's C Series aircraft and its progress for some time and today we are very pleased to announce an agreement to acquire the CS300 for our mainline fleet," said Mr. Rovinescu. "The C Series will be a key element of our on-going fleet renewal, which will result in Air Canada operating one of the world's youngest and most fuel efficient airline fleets. With its optimal mainline performance range, superior economics, and greater seating capacity, the Canadian-built CS300 aircraft will allow us to compete more effectively, providing increased point-to-point service to domestic and transborder markets further afield, as well as feeding our network."
"We're thrilled to welcome Air Canada as our first mainline, international carrier located in North America. A landmark order from a marquee and iconic customer like Air Canada is a very significant strategic marker for the C Series aircraft program and we're looking forward to further strengthening a relationship that spans 30 years," said Mr. Cromer. "The C Series aircraft has proven and exceeded its performance targets and can readily be used as a coast-to-coast mainline connector or to open direct flights to under-served destinations. Performance and exceptionally low operating costs are ultimately what make this plane a success and Air Canada is recognizing that the C Series aircraft was designed in line with evolving market requirements."
"Our recent focus has been to add a large North American international network carrier to complement our orders in both Europe and Asia, and with Air Canada we are achieving our goal of creating a strong global footprint for the C Series aircraft," said Mr.Bellemare. "We are bolstered and energised by Air Canada's confidence in the C Series aircraft programme and very assured that the carrier's commitment - which is one of the largest to date for this aircraft - will be the catalyst for future orders in North America and around the world. We have the best aircraft in the 100- to 150-seat class segment and the momentum continues to build as we introduce the C Series to potential customers."
Bombardier has also announced that it will take steps to optimise its workforce with a combination of a manpower reduction and strategic hiring throughout 2016 and 2017. As the company evolves over the next two years, its global workforce will be reduced by a targeted 7,000 production and non-production employees, including 2,000 contractors. This reduction will be partially offset by hiring in certain growth areas, notably to support the ramp-up of strategic programmes and projects worldwide, such as the C Series. These adjustments will enable Bombardier to resize its organisation in line with current business needs and to increase its competitiveness.
The reorganisation is based on an in-depth review of the company carried out over the past year: Production rates have been modified for some aircraft models due to macroeconomic conditions. As a result, Bombardier is adapting its workforce to meet market demand. Major aerospace development programmes and projects at Transportation, which mobilised numerous employees, are ramping down as expected. Bombardier is resizing its manpower to match future workloads.
In parallel, Bombardier intends to hire in certain growth areas:
The C Series aircraft program continues to ramp up its production rate and to win orders, generating new jobs at the Bombardier facility in Mirabel, Québec. The number of employees directly assigned to the C Series program has increased in the past few months, reaching a total of 3,450 employees worldwide, and is expected to keep growing over the next few years.
In addition, Bombardier Transportation's impressive $30.4-billion backlog includes certain large orders which will mobilize additional manpower in regions where it has a limited presence.
“Throughout 2016 and 2017, we will adapt our global manpower to current market conditions, while hiring to support growing segments, such as the C Series,” said Mr. Bellemare. “These adjustments are always difficult. They are important to ensure that, with our 64,000 employees worldwide, we continue to create superior value for our customers, be more competitive, and deliver improved financial performance,” he added.
Impacted positions are mostly based in Canada and Europe, where the company’s aerospace and rail transportation activities are concentrated. Bombardier will support affected employees and will provide them with resources to help them manage through their transition.
This includes employees across Bombardier operations in Northern Ireland. Bombardier Vice-President Michael Ryan said: "The whole global aerospace world is looking at how they can optimise their costbase and that includes going to what we would call lower cost countries.
"If we want to compete being in a global market place then we need to take advantage of that where it's relevant.
"But I have to say that the technologies we're investing in, the value-added process, the higher value programmes we're looking at, are a key part of Belfast's future going forward and will continue to be."
The table below presents an overview of targeted workforce reductions by business segment.
Business segment
Targeted workforce reduction
Aerostructures and Engineering Services
2,500
Business Aircraft
500
Commercial Aircraft
0
Product Development Engineering, Aerospace
800
Transportation
3,200
Total
7,000
The reductions will begin in the coming weeks and will be implemented over a period of two years.