Bombardier and Airbus confirm that they held talks regarding “business opportunities” but the discussions “are no longer being pursued”.
Both companies issued statements to contradict reports saying such talks were still underway. The initial reports immediately improved Bombardier’s share price.
But Airbus quickly released a statement confirming that talks occurred, but clarified that “such discussions are no longer being pursued”.
Bombardier attributed the discussions to the company’s broader strategic review initiated when Alain Bellemare became chief executive earlier this year, taking over as delays and weak sales of the CSeries and other development programmes put the company in a financial crisis.
“As previously mentioned, Bombardier will continue to explore initiatives such as a potential participation in industry consolidation,” Bombardier says in a statement.
But the confirmation that Bombardier and Airbus had met to consider opportunities seemed a significant surprise. For several years, the Canadian manufacturer had collaborated with Chinese manufacturer Comac, attempting to increase the level of commonality between the CSeries and the C919.
Airbus, however, seemed only interested in burying the CSeries in the marketplace. Airbus chief operating officer John Leahy has openly talked of his desire to use the market power of the A320 and A320neo family to deny sales to the smaller CSeries family.
Meanwhile, the 110-seat CS100 version of the CSeries family is nearing certification later this year and entry into service in the first half of next year with Swiss International Air Lines, followed by the debut of the CS300 six months later.
In recent weeks, Bombardier executives have spoken about refocusing sales efforts on securing “marquee” deals with a small number of major customers, using a revamped sales team headed recently hired head salesman Colin Bole.
The company’s business challenge is compounded by the looming cost of ramping up CSeries production, even as development continues on the Global 7000 and Global 8000 business jets.
In August, Moody’s warned that Bombardier’s cash position could decline to a minimum level of $2 billion next August, given current spending trends.
Source: Cirium Dashboard
