Bombardier’s turnaround now has the company looking squarely at the future, as evidenced by the introduction of the Global 5500 and Global 6500 business jets and a substantial re-order for C Series aircraft by airBaltic, an existing operator.  Momentum appears to be building, and the company is now focused clearly on tomorrow, as well as on executing today.

Since the new management team took over at  Bombardier in late 2015, the company has completed an amazing turnaround. The financial results and stock price speak for themselves.  The introduction of two new business jets, combined with a substantial C Series reorder by AirBaltic within a 24 hour period underscores the scope of the turnaround.  When the new team took over, they needed to complete the  C Series, find major customers, and find a partner for the program. They succeeded with each while continuing to expand the business jet product line with a secret development program that was actually kept secret.  Keeping a secret is especially difficult in today’s environment and multiple outlets on the internet.  Catching a competitor off guard these days is difficult, but Bombardier was successful in keeping the two new products out of the press.

The C Series was not only successfully introduced but exceeded its performance numbers out of the box.  The proof of its success is re-orders that reflect customer confidence, which is beginning earlier in the life of the program that might have been expected.  Finding a strong C Series partner in Airbus will likely close six months earlier than planned, and the integration process is well underway with teams being seconded to the new company, nicknamed ABC for Airbus-Bombardier Canada.  The partnership could hit the ground running at Farnborough with new orders, and momentum for what will soon become the Airbus A200 series appears to be building.

Add to that a second life for the CRJ, which remains the most cost-efficient regional jet meeting US scope clauses, which is a bonus, as the battle between the existing E175 at Embraer and CRJ-900 continues while new technology E175-E2 and MRJ are foreclosed from the US market.  Add the sale of the Downsview facility, which enables new state of the art facilities at Pearson, while maintaining the experienced workforce and generating positive cash flow.  The land is worth a more as a development project than a little-used airport, and Bombardier can leverage its move with strong improvements to manufacturing productivity.

On multiple fronts, Bombardier is becoming more competitive, and the company has its “mojo” back.

The Bottom Line

The turnaround at Bombardier Aerospace is well underway and the new team is now seeing the fruit from its initial and difficult decisions. The outlook has changed from uncertainty to positive in the last three years, and it appears that momentum is building.  We’ll know even more after the Farnborough Air Show, but performance, momentum, and expectations are higher than we’ve seen in recent years.

Please follow and like us:
%d bloggers like this: