Manufacturer ends amphibious aircraft production and takes C$264 million Q400 charge

Bombardier expects aircraft deliveries to remain flat this year and next, despite a drop in business aircraft sales. Reporting surprisingly strong third-quarter results, the Canadian company says it expects to deliver 370 aircraft this financial year - the same total as last year, and down from the previously forecast 420 - and a similar number next year.

Meanwhile, Bombardier has suspended production of the CL-415 amphibious aircraft until it receives enough orders to restart the line. The company has also taken a third-quarter charge of C$264 million ($166 million) related to the non-recurring costs of the slow-selling Q400 regional turboprop.

Aerospace sales increased slightly in the third quarter, to C$2.57 billion from C$2.55 billion last year, despite a drop in aircraft deliveries from 85 to 69. Most of the reduction was in business jet shipments, which fell to 24 aircraft. Income was down from C$285 million last year to C$240 million. In total Bombardier reported consolidated revenue up 30% at C$5 billion and income before charges up 12% at C$380 million.

Chief executive Robert Brown blamed some of the aerospace delivery decline on disruptions after the 11 September terrorist attacks. As a consequence, the company expects to deliver 64 business jets in the fourth quarter, for a total of around 180 for the year ending 30 January - less than the figure for 2000. He does not expect a rebound before the second half of 2002.

Brown says that no regional jet orders have been delayed or cancelled, and deliveries continue "as quickly as the airlines can absorb them in their new circumstances". Although aircraft deliveries are set to remain flat next year, revenues will increase, since the larger CRJ700 regional jet will make up a greater proportion of shipments.


Source: Flight International