Bombardier gets more C-Series good news, firms up order

Thu Dec 20, 2012 3:52pm EST
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(Reuters) - Shares of Bombardier Inc (BBDb.TO: Quote) rose on Thursday after its new C-Series jet program received its second dose of good news in as many days when Latvia's airBaltic firmed up a tentative order for 10 of the narrow-body commercial planes.

The announcement came hot on the heels of news late on Wednesday that an airline based in the Americas had signed a letter of intent to buy 12 C-Series jets, with options for another 18 aircraft, ending a five-month order drought for the 110- to 149-seater plane.

Orders for the all-new C-Series, Bombardier's bold $4 billion bet on its biggest plane yet, have been slow, standing at only 148 some 18 months ahead of the aircraft's entry into service.

The tentative order from the unnamed Americas-based airline was positive as it is the first commitment from a customer since Bombardier announced last month that it was delaying the C-Series' inaugural flight by six months, National Bank Financial analyst Cameron Doerksen said.

That said, the back-to-back announcements from Bombardier this week were likely to be coincidence and did not signal a sudden unleashing of interest in the plane, he said.

"Historically we have seen with other aircraft programs that the trigger point for a significant increase in order activity tends to be the first flight," Doerksen said.

Shares of Bombardier, the world's third-biggest commercial planemaker, were 3 percent higher at C$3.68 on the Toronto Stock Exchange on Thursday afternoon.

Doerksen said the unnamed America's-based airline was likely to be a South American carrier as there had been "no rumors or speculation that the major U.S. or other North American airlines are close to making an order for the C-Series".

The airBaltic order contains an option for up to 10 more C-Series planes, Bombardier said. The deal is worth about $764 million, or up to $1.57 billion if all of the options were exercised.   Continued...

Visitors chat in front of a mock cabin of a Bombardier business jet on the first day of the China International Aviation & Aerospace Exhibition in the southern Chinese city of Zhuhai November 13, 2012. REUTERS/Bobby Yip