Aircraft

Bombardier Aerospace expects the first major aircraft subassembly to be delivered from its new Queretaro site in northern Mexico before the end of January 2007, as it moves ahead with plans to transfer even more work to lower-cost production sites in China and Mexico. The company says the first Mexican-made part will be a Challenger 850 fuselage, formerly made by its Belfast site in the UK.

The structure is interchangeable with the fuselage of the CRJ200 regional jet, production of which was officially suspended in January this year amid the continued downturn in the 50-seat RJ market. The suspension was accompanied by 660 of the 1,135 layoffs originally announced by the company last August at its Montreal-area and Belfast facilities. Bombardier is also moving large parts of its major aerospace subassembly work away from Mitsubishi Heavy Industries (MHI) in Japan, and transferring it either to Mexico or to China's Shenyang Aircraft (SAC).

Under a deal signed at the UK's Farnborough air show last month with parent company China Aviation Industries I (AVIC I), SAC will build the fuselage sections, empennage and doors of the Q400 turboprop. "We are now also transferring the Q series flight-control work from MHI to Mexico," adds Bombardier. This includes the rudder, elevator and horizontal stabiliser assemblies, though the company adds that existing CRJ700/900, Challenger 300 and Global Express assembly work is "going steady" at MHI. However, sources close to the cost-reduction studies say additional work transfers to Mexico are also being considered.

MHI urgently needs extra capacity to satisfy Boeing's massive production ramp-up on the 787, for which it produces centre wingbox sections. MHI declines to comment on the work transfer.