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Bombardier Aerospace

The world's third largest civil aircraft manufacturer, Bombardier Aerospace is a leader in the design and manufacture of innovative aviation products and services for the business, regional and amphibious aircraft markets. Bombardier Aerospace Group - North America, which includes Canadair and de Havilland, is a world leader in the production of commuter jets. Bombardier operates 10 manufacturing and services facilities in Canada and a total of 7 facilities in the United States and Germany. Bombardier is also a major manufacturer of passenger railcars. Headquartered in Montréal, Canada, Bombardier Aerospace employs more than 28,000 people worldwide. Bombardier Aerospace's revenues amounted to $2.3 billion for the three-month period ended October 31, 2008. The company's backlog stood at $26 billion as at October 31, 2008, reflecting a solid level of 68 net orders, while 80 aircraft were delivered.

Today's Bombardier grew out of a young mechanic's inventive genius and entrepreneurial spirit. Born in 1907, Joseph-Armand Bombardier builds his first "snow vehicle" at the ripe age of 15. His motivation? To help people travel across the snow-covered roads of rural Québec in Canada. In 1937, J.-Armand achieves his first major commercial success with the launch of the seven-passenger B7 snowmobile. Joseph-Armand Bombardier never abandons his dream of inventing the perfect personal snowmobile. His persistent experimentation eventually spawns a brand-new industry: snowmobiling. In 1959, he launched his world-famous Ski-Doo.

The 1973 oil crisis forced Bombardier to halve its snowmobile production. Laurent Beaudoin and his management team responded by redeploying the company's excess manufacturing capacity. They acquire mass transit technologies and apply Bombardier's manufacturing know-how to build rolling stock. In 1974, Bombardier wins its first mass transit contract to manufacture 423 cars for the city of Montréal's subway system. A breakthrough $1 billion US contract to supply 825 subway cars for the New York City Transit Authority positions Bombardier as the North American leader in rail transit. In 1986, Bombardier expanded in Europe, the world's largest rail equipment and services market, acquiring a 45% interest in the Belgian manufacturer BN Constructions Ferroviaires et Métalliques S.A. In 1989, Bombardier acquired ANF-Industrie, France's second largest manufacturer of railway equipment.

In 1986, Bombardier diversified again, this time, entering the aerospace industry. It purchased Canadair, the leading Canadian aircraft manufacturer of Challenger widebody business jets and the CL-215 amphibious firefighting aircraft. Three years later, Bombardier launches the 50-seat Canadair Regional Jet (CRJ) program and revolutionizes regional air travel. A 70-seat version follows in 1997 (CRJ700), an 86-seat version in 2000 (CRJ900) and a 100-seat version in 2007 (CRJ1000). In 1989 Bombardier acquired Short Brothers plc, the pioneering aviation manufacturer based in Northern Ireland. With this acquisition, Bombardier reinforced its aerospace capabilities and establishes a European presence in the industry.

The acquisition of Learjet Corporation's assets in 1990 gave Bombardier access to the American aerospace industry and the most complete range of business jets on the market. Bombardier promptly launched the Learjet 60 aircraft, the first midsize business jet, which would rank as the top-selling aircraft in its class four years later. In 1992, Bombardier acquired Boeing's de Havilland division, based in Canada, manufacturer of the Twin Otter aircraft and Dash turboprop airliner. De Havilland's Dash 8 turboprop and the CRJ Series establish Bombardier as one of the world leaders in regional aircraft.

In 2000, Bombardier acquired Skyjet.com, a pioneer in real-time online air charter reservations. Bombardier expands this service in 2005 with the launch of Skyjet International, giving travellers unrestricted access to more than 900 business jets worldwide. In 2002, Bombardier launches the Bombardier Global 5000 super-large business jet. A year later, the company adds the Global Express XRS ultra long-range business jet. This aircraft combines superior transatlantic speed with the largest cabin in the super-large segment, the summit of accomplishment in the world of business jets. The Challenger 605 intercontinental business jet and Learjet 60 XR midsize business jet follow in 2005. Also in 2005, Bombardier launched the Challenger 800 Series corporate shuttles, the latest evolution of its flagship Challenger, undisputed champion of the large business jet category.

In August 2003 Bombardier broke with its rural Quebec roots by selling a unit that makes snowmobiles and other leisure craft for 1.23 billion Canadian dollars ($875 million) in cash. The buyers include Bain Capital of Boston and members of the Bombardier family, who still controlled the parent company.

By 2016 the Quebec government, which committed $1 billion to help Bombardier complete its delayed and costly commercial jet program, wanted PM Justin Trudeau to pitch in. The struggling airplane and train manufacturer employs thousands in the province. Media reports suggested Quebec wanted between $350 million and $1 billion from Ottawa. For Quebec, Bombardier was too big to fail. The aerospace industry in Quebec employs more than 41,000 people, with Bombardier accounting for more than 17,700 of those jobs. The province agreed to a bailout worth as much as $1.3 billion to support the struggling plane and railway car maker. Under a deal that took eight months to nail down, the C Series program will be carved out into a partnership that will be 50.5 percent owned by Bombardier and 49.5 percent by Quebec.

On June 30, 2016 Bombardier issued in the name of Investissement Québec warrants exercisable for a total number of 50,000,000 Class B shares (subordinate voting) in the capital of Bombardier, exercisable for a period of five years at an exercise price per share equal to $1.72 US, being the U.S. dollar equivalent of $2.21 Cdn at the date of execution of the subscription agreement. Additional warrants, exercisable for a total number of 50,000,000 Class B shares (subordinate voting) in the capital of Bombardier, will be issued concurrently with the disbursement of the second $500 million US installment of the investment.

Prime Minister Justin Trudeau said in June 2016 that the federal government still was considering Bombardier’s request for $1 billion in aid. The company had balked at demands that its founding family loosen control and issue $1 billion in new stock.

In April 2017, Boeing launched a trade complaint against Canada’s Bombardier jetmaker claiming unfair competition practices due to Canadian government subsidies. This is even though the Bombardier C-series doesn’t directly threaten Boeing’s passenger models.

On 18 May 2017 US Department of Commerce Secretary Wilbur Ross announced the initiation of new antidumping (AD) and countervailing duty (CVD) investigations to determine whether imports of 100- to 150-seat civil aircraft (civil aircraft) from Canada are being unfairly dumped in the United States, and whether Canadian producers are receiving alleged unfair subsidies.

On 26 September 2017 US Secretary of Commerce Wilbur Ross announced the affirmative preliminary determination in the countervailing duty (CVD) investigation of 100- to 150-seat large civil aircraft from Canada, finding that exporters of this merchandise received countervailable subsidies of 219.63 percent. The Commerce Department will instruct U.S. Customs and Border Protection to collect cash deposits from importers of 100- to 150-seat large civil aircraft based on these preliminary rates. “The U.S. values its relationships with Canada, but even our closest allies must play by the rules,” said Secretary Ross. “The subsidization of goods by foreign governments is something that the Trump Administration takes very seriously, and we will continue to evaluate and verify the accuracy of this preliminary determination.”

If and when Bombardier exports these planes to the United States, CBP will require cash deposits in amounts equal to the preliminary subsidy rate. “Standard 100- to 150-seat two-class seating capacity” refers to the capacity to accommodate 100 to 150 passengers, when eight passenger seats are configured for a 36-inch pitch, and the remaining passenger seats are configured for a 32-inch pitch. “Pitch” is the distance between a point on one seat and the same point on the seat in front of it.

Canadian Foreign Affair Minister Chrystia Freeland said 26 September 2017, “The government of Canada cannot treat, as a trusted partner, a company which is attacking our aerospace sector.... Canada strongly disagrees with the anti-dumping and countervailing duty investigations into imports of Canadian large civil aircraft. This is clearly aimed at eliminating Bombardier’s C Series aircraft from the US market.” She said “?Components of the Bombardier C Series are supplied by American companies, directly supporting almost 23,000 well-paying jobs in many U.S. states, including Connecticut, Florida, New Jersey, Washington, New York, Ohio, Kansas, Pennsylvania and Colorado. Boeing’s petition is threatening these U.S. jobs."

Bombardier is a major employer in Quebec, a province where the Liberals of Prime Minister Justin Trudeau need to win extra seats in an election scheduled for October 2019. Trudeau stated that the government was “disappointed and … will continue to fight for good Canadian jobs.” He announced that Canada will not pursue plans to buy 18 Boeing F-18 Super Hornet fighter jets unless the challenge is withdrawn.

Learjet 45


Learjet 60


Learjet 85


Cl-300


CL-600


CRJ

C-Series

BRJ-X




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Page last modified: 02-10-2017 18:47:08 ZULU