Bombardier nears launch of new CSeries jet

Fri Feb 22, 2008 6:08pm EST
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By Robert Melnbardis

MONTREAL (Reuters) - Bombardier Inc's (BBDb.TO: Quote) $2.5 billion plan to develop a new 110- to 130-seat airliner took a key step forward on Friday when the company said it had obtained approval from its board to seek customers for its proposed CSeries jet.

Bombardier said it wants to get firm orders -- from one or two launch customers that will take 50 to 100 planes -- before formally deciding to go ahead with the project.

"This is the first step toward a launch that we expect to do in 2008," Bombardier Aerospace President Pierre Beaudoin said during a conference call with analysts.

That would bring the aircraft into service by 2013.

Bombardier is still considering doing the wing work for the CSeries at its facility in Belfast, Northern Ireland, where 1,200 to 2,000 jobs would be created, and final assembly of the aircraft at Mirabel in the Canadian province of Quebec, where it could add up to 2,500 employees to its aerospace workforce of 12,000.

The rise by the Canadian dollar to parity with the U.S. dollar and strength of the pound sterling, however, has prompted the Montreal-based company to consider doing final assembly in the United States at what would be a new plant, Beaudoin said.

Bombardier's new facility in Mexico might also have a hand in component manufacturing. Some 600 engineers would be involved in the overall project.

Aside from increasing its development cost to $2.5 billion from the original $2.1 billion, Bombardier said it expects to take on an additional $700 million of capital costs for plant construction and tooling.   Continued...