Bombardier will have to lay off more workers if there is not more government support to finance aircraft sales, warns chief executive Paul Tellier. This includes support for Bombardier's bid for an expected large order for regional jets by Air Canada, Tellier said in a speech at the Aerospace Industries Association of Canada's annual meeting in Montreal.

The comments follow a survey by Forecast International/DMS of Connecticut that predicts deliveries of regional jets by 2012 will be 10% lower than the firm expected last year. Bombardier's totals will be 1,398 deliveries, down 13% from last year's forecast.

Its market share will drop from 37% to 34%, according to the forecast.

Although the airline industry shows signs of recovery, Tellier says Bombardier still needs more financial backing from Ottawa for potential clients. He says while Ottawa provides financing to Bombardier customers through the Export Development Corporation there is a perception that the EDC financing is a subsidy to Bombardier.

"It's difficult to look at any restructuring plan of any significant airline without seeing the word regional. However, if the financing is not in place, we can't make those sales and we'll have to reduce the rate of production," he says, which will lead to job cuts.

Tellier says if Bombardier is selected for the Air Canada order, he'll approach Ottawa to help finance the sale, even though the EDC is for export sales only.

In an effort to find more funding, Bombardier is trying to persuade its largest suppliers to invest in a pool of equity to finance future sales. Its biggest suppliers are being asked to come up with about $50 million each in an effort to raise about $200 million.

Source: Flight International