Bombardier in talks with Canadian government on CSeries investment: CEO
By Allison Lampert
LAS VEGAS (Reuters) - Bombardier Inc is in talks with the new Canadian government about a further cash infusion into its struggling CSeries jet program, which the planemaker expects to turn a profit by around 2020, according to Chief Executive Alain Bellemare.
The long-delayed single-aisle passenger jet program is already billions of dollars over budget and has left Quebec-based Bombardier saddled with over $9 billion in debt. The 2020 profitability date is broadly in line with analyst expectations.
"We've been in discussion with them regarding some sort of participation on some form of financing investment," Bellemare told Reuters at an aviation industry conference in Las Vegas on Monday, referring to Canada's new federal government. "It is still in the early stage so I wouldn't want to speculate more than that."
Bellemare said it is tough to forecast precisely when the CSeries will be profitable, as much depends on the ramp-up in production volumes and the company's ability to trim costs.
"There are many pieces to this puzzle so 2020 is a good time frame," said Bellemare. He declined to comment on when Bombardier would have any new orders for the CSeries or name potential buyers.
The financing talks come after the Quebec government said last month it would invest $1 billion in the CSeries program in return for a near 50-percent stake in the project.
Canadian Prime Minister Justin Trudeau said on Nov. 10 any Bombardier aid would be based on a strong business case and not on "emotion, politics or symbols."
Bombardier has received 243 firm orders for the CSeries, but it is still short of its target of 300 firm orders by the time the jet enters service in 2016. Last month, Bombardier said it was in "advanced discussions" to sell the CSeries jet to airlines in North America, but it did not identify potential buyers. Continued...