Bombardier order traction begs for large carrier endorsement

Washington DC
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While Bombardier celebrates virtually back-to-back CSeries orders after a year-long fallow period, the firm is still seeking a major purchase by a blue-chip carrier.

The drought-breaking order by Braathens Leasing for 10 aircraft, split evenly between the CS100 and CS300, was quickly followed by a pledge for three CS100s from a "well-established airline" that wishes to remain anonymous for the moment.

Although the orders are a far cry from the 40 ordered by Republic Airways more than a year ago, the consensus is captured neatly by Raymond James analyst Steve Hansen. "We view any order as positive at this point," he said.

However, Hansen remains "cognisant of the prospects surrounding further CSeries orders, including potential near-term announcements at the Paris air show".

But Bombardier Aerospace president Guy Hachey remains coy on Bombardier's plans for Paris, quipping: "You'll have to follow us closely."

Another programme likely to be watched keenly at the show is the Airbus A320neo family, specifically the re-engined A319, which is pitched as a potential threat to the CS300.

Bombardier faces an aggressive Airbus sales team, Teal Group analyst Richard Aboulafia has warned, adding that the Canadian airframer needs to be prepared to adopt some of the tactics McDonnell Douglas used when it transitioned from the DC-9 to the MD-80: heavy discounting, performance and residual guarantees and walk-away rights. "When you're going up against Airbus you better have some of that in your arsenal," says Aboulafia.

While Hachey argues the A319neo with the Pratt & Whitney PW1100G powerplant will be 12% less efficient than the CSeries "even with the new engine", he admits to a challenge "if there is a family or commonality issue or if it is customer that [has] already heavily invested in Airbus".

But he also remains bullish over the flexibility the CSeries offers to "move away from the commonality argument", including restrictive noise and emissions requirements and short runways.

Hachey cites Lufthansa as an example of the ability of the A320neo and CSeries to co-exist: Lufthansa has ordered 60 aircraft from each airframer - 30 A320neos and 30 CS100s.

So far Lufthansa is the lone global airline to have placed a firm order for the CSeries, and Aboulafia stresses that Delta Air Lines might be one of the best chances Bombardier has to capture a coveted order from a second major carrier. However, he warns that if Airbus makes an aggressive move in that campaign, it would be tough for Delta to justify ordering a niche aircraft.