Bombardier to chop more jobs as jet orders drop
By John McCrank
TORONTO (Reuters) - Bombardier Inc announced another round of job cuts at its aerospace division on Thursday, slashing 715 jobs in the Montreal area due to a lack of new orders for its CRJ regional jets.
Bombardier, the world's No. 3 planemaker and No. 1 trainmaker, has seen the market for its narrow-body regional airliners and business jets freeze up because of the soft global economy.
Many airlines canceled or deferred aircraft orders as travel demand dropped and they slashed costs, which led Bombardier to cut about 4,360 jobs in two rounds of layoffs earlier this year.
The new job cuts are likely enough to adjust for the lower production rates, said Chris Sears, an analyst at MacDougall, MacDougall & MacTier in Montreal.
"With the cuts they've made, I think they've been pretty aggressive," he said.
He added that there appears to be strong interest in the 70- to 100-seat CRJ jets, but most airlines will need to see a rebound in the economy before they have enough confidence to place new orders.
"I think demand will come back, but certainly not in the next couple of quarters," said Sears.
Benoit Poirier, an analyst Desjardins Securities, said that the cuts were not a surprise, as Bombardier only received one tentative order for CRJ aircraft in the latest quarter, which was a letter of intent from American Airlines for 22 CRJ700s. Continued...