As it delivers first CSeries jet, Bombardier still sees federal support as ‘critical’
The plane maker racked up $2 billion in cost overruns on the commercial airliner project, which was two and a half years behind-schedule
MIRABEL, Que.—Bombardier says it still needs federal financial support for its new CSeries aircraft despite turning the page on delays and cost overruns with the delivery of the first plane to Swiss International Air Lines.
“Federal support in a program like this one is absolutely critical,” CEO Alain Bellemare said Wednesday after media were taken on a 45-minute flight over Quebec’s Laurentians.
While the Montreal-based manufacturer is in an “excellent” position, he said a requested US$1 billion in funding from Ottawa would provide additional flexibility as it ramps up production of the industry’s first new single aisle plane in 30 years.
“We would definitely welcome a partnership with Canada if we can find a win-win solution,” Bellemare told reporters before cutting off more questions about federal funding.
Bellemare said the 2 1/2 years of delay and at least $2 billion in cost overruns are a well-documented part of the program’s past.
The situation today is very different with 370 firm orders from marquee airlines like Air Canada, Delta and Swiss, he said.
“We are here today to celebrate years of very hard work and it has not been easy,” he added, standing beside Bombardier executive chairman Pierre Beaudoin.
“It has been a bumpy journey but developing aircraft like that is not easy. So I think we should be very proud. It’s an amazing Canadian innovation.”
Federal Transport Minister Marc Garneau said the government views the aerospace industry as being extremely important for Canada, but declined to say when a deal could be reached.
“We care a lot about Bombardier. It’s one of the stars and the discussions will continue,” he said in an interview before boarding a second flight with government officials, suppliers and employees.
The aerospace manufacturer recently finalized an agreement with the Quebec government on a US$1-billion investment in exchange for a 49.5 per cent stake in the CSeries. The province will make two US$500 million payments: the first on Thursday and the second due Sept. 1.
Bombardier is also seeking a similar contribution from the federal government. However, Ottawa has reportedly pushed Bombardier to change its voting structure, something the founding family that controls the company through multiple voting shares has said it has no intention of doing.
Government financial support has attracted the ire of Brazilian rival Embraer, which has threatened to launch a challenge at the World Trade Organization after Bombardier signed large orders for the CSeries from Delta Air Lines and Air Canada.
Meanwhile, the first CSeries jet is officially out of Bombardier’s hands. The company formally delivered the CS100 to European carrier Swiss at Montreal’s Mirabel airport yesterday.
The plane, the first of 30 firm CSeries orders by Swiss International, is scheduled to leave for Zurich on Thursday morning and begin regular service July 15.
The Lufthansa subsidiary said it will receive nine planes this year, 10 in 2017 and the rest in 2018.
Swiss chief technical officer Peter Wojahn said it has more than 30 pilots licensed to fly the aircraft and expects the plane to deliver fuel and operating cost savings and a great passenger experience.
While the carrier never doubted the plane would be delivered, he said airline officials grew concerned over negative media reports.
“As we did see how this program was progressing we were still convinced we were going to make it,” he said.
The CSeries Pratt and Whitney engines propelled the plane into a speedy, quiet takeoff on its first passenger flight in North America. With the cockpit door open, passengers caught views as the pilots flew over Mont Tremblant before returning to a smooth landing.
A similar flight took place June 3 between Dublin and Zurich. A test aircraft will also conduct passenger flights next month at the Farnborough Air Show near London.
Bombardier has secured 370 firm orders and 252 options and purchase rights for the CSeriess. The first CS300 plane, which is larger than the CS100, is expected to be delivered later this year to Air Baltic.