Airbus buys majority stake in Bombardier's CSeries program

BTN News
Wednesday, 18 October 2017
In a move that will protect jobs in Ireland, boost aircraft manufacturing in the USA, seriously annoy US plane maker Boeing and put obstacles in the way of China's aircraft manufacturing ambitions, Europe's Airbus has agreed to buy a majority stake in Canada's Bombardier CSeries jetliner program.
The deal is subject to Canadian government approval and will cost Airbus nothing for its 50.01 percent interest in CSeries Aircraft Limited Partnership (CSALP), which manufactures and sells the jets.
 
The 110-to-130 seat plane (developed at a cost of US$6 billion) has not secured a new order in 18 months and faces a possible 300 per cent duty on US imports after Boeing claimed it was illegally subsidised by the UK and Canadian governments. Bombardier labelled that "absurd", while the UK Government said the statement was "disappointing" and pledged to defend British interests "at the very highest levels" in the US.
 
Canadian Innovation minister Navdeep Bains, who still must approve the deal, said in a statement that “on the surface, Bombardier’s new proposed partnership ... would help position the CSeries for success”.
 
Boeing said in a statement: " This looks like a questionable deal between two heavily state-subsidised competitors to skirt the recent findings of the US government.
 
"Our position remains that everyone should play by the same rules for free and fair trade to work."
 
US authorities are expected to look very carefully at the plan.
 
US assembly
 
As part of the deal, CSeries jets destined for US customers would be assembled in Airbus' US plant in Alabama to avoid possible US anti-subsidy and anti-dumping duties of 300 per cent.
 
If all approvals are given, the deal is expected to close in the second half of 2018.
 
The Airbus agreement not only injects critical financial and marketing expertise for Bombardier, it also puts a crimp on China’s home-grown aircraft-selling ambitions for the Commercial Aircraft Company's (Comac's) C919.
 
As well as selling the CSeries in China against the Comac C919, Airbus, with its global presence, will provide support for the CSeries jet everywhere, a promise Comac cannot match.
 
In Northern Ireland, meanwhile, the smiles could hardly be wider as the deal raises the likelihood that many jobs will be at least safer.
 
Bombardier is the largest manufacturing employer in Northern Ireland. It employs more than 4,000 people at its Belfast wing-making factories and is due to begin delivering 125 new CSeries jet wings to Atlanta-based Delta Airlines next year. (Despite the announced 300 per cent duty slug, Delta had said it still expected to take delivery of the jets.) 
 
Bombardier expects a C$400 million loss in commercial aircraft this year, but has set a breakeven target for 2020.

 

Airbus buys majority stake in Bombardier's CSeries program

BTN News
Wednesday, 18 October 2017
In a move that will protect jobs in Ireland, boost aircraft manufacturing in the USA, seriously annoy US plane maker Boeing and put obstacles in the way of China's aircraft manufacturing ambitions, Europe's Airbus has agreed to buy a majority stake in Canada's Bombardier CSeries jetliner program.
The deal is subject to Canadian government approval and will cost Airbus nothing for its 50.01 percent interest in CSeries Aircraft Limited Partnership (CSALP), which manufactures and sells the jets.
 
The 110-to-130 seat plane (developed at a cost of US$6 billion) has not secured a new order in 18 months and faces a possible 300 per cent duty on US imports after Boeing claimed it was illegally subsidised by the UK and Canadian governments. Bombardier labelled that "absurd", while the UK Government said the statement was "disappointing" and pledged to defend British interests "at the very highest levels" in the US.
 
Canadian Innovation minister Navdeep Bains, who still must approve the deal, said in a statement that “on the surface, Bombardier’s new proposed partnership ... would help position the CSeries for success”.
 
Boeing said in a statement: " This looks like a questionable deal between two heavily state-subsidised competitors to skirt the recent findings of the US government.
 
"Our position remains that everyone should play by the same rules for free and fair trade to work."
 
US authorities are expected to look very carefully at the plan.
 
US assembly
 
As part of the deal, CSeries jets destined for US customers would be assembled in Airbus' US plant in Alabama to avoid possible US anti-subsidy and anti-dumping duties of 300 per cent.
 
If all approvals are given, the deal is expected to close in the second half of 2018.
 
The Airbus agreement not only injects critical financial and marketing expertise for Bombardier, it also puts a crimp on China’s home-grown aircraft-selling ambitions for the Commercial Aircraft Company's (Comac's) C919.
 
As well as selling the CSeries in China against the Comac C919, Airbus, with its global presence, will provide support for the CSeries jet everywhere, a promise Comac cannot match.
 
In Northern Ireland, meanwhile, the smiles could hardly be wider as the deal raises the likelihood that many jobs will be at least safer.
 
Bombardier is the largest manufacturing employer in Northern Ireland. It employs more than 4,000 people at its Belfast wing-making factories and is due to begin delivering 125 new CSeries jet wings to Atlanta-based Delta Airlines next year. (Despite the announced 300 per cent duty slug, Delta had said it still expected to take delivery of the jets.) 
 
Bombardier expects a C$400 million loss in commercial aircraft this year, but has set a breakeven target for 2020.