Bombardier to cut 7,500 more jobs through 2018, mostly in rail
By Allison Lampert
MONTREAL (Reuters) - Bombardier Inc said on Friday it would cut 7,500 jobs, mostly in its train-making division, in a second round of layoffs announced this year, following extended delays and budget overruns in its aerospace business.
About two-thirds of the jobs are in Bombardier Transportation, the Germany-based rail unit which had already been slated to eliminate about 3,500 workers. The rest will be in aerospace, the company said in a statement.
Bombardier, which ended 2015 with 70,900 employees, said in February it would cut 10 percent of its workforce over two years, with nearly half of those jobs in the rail unit.
The unit, with a large staff in Europe, has struggled to deliver on some high-profile public transit contracts, including in Toronto.
Bombardier said it expected the layoffs would lead to recurring savings of about $300 million by end-2018. It will book restructuring charges of $225 million to $275 million as special items, beginning in the fourth quarter and through 2017.
The cuts are part of a broader turnaround plan backed by Canada's second-largest pension fund, Caisse de depot et placement du Quebec, the rail unit's largest shareholder, said spokesman Maxime Chagnon.
The Caisse, which secured three BT board seats after buying a 30 percent stake in the division in November for $1.5 billion, wants Bombardier to improve the unit.
In a telephone call, Bombardier Chief Executive Alain Bellemare said he did not expect the cuts, which include 1,500 workers in Quebec and 500 in the rest of Canada, to affect talks with the federal government over a $1 billion investment in its CSeries mid-range jet program. Continued...