Questions remain over future of Dash 8 turboprop as backlog shrinks to 26 aircraft

Bombardier's de Havilland workforce has started to return to work after a two-month shutdown, but the company warns that in the absence of a new agreement to cut costs, the future of Dash 8 regional turboprop and Global Express business jet production at the Toronto plant remains in question.

The company wanted a new labour deal agreed by 4 February, when 1,360 of 1,600 workers laid off late last year were due to return to work. Talks with unions have broken down. The current contract does not expire before June, but the company warns that the employees still furloughed may be permanently laid off.

"We now have to start looking at alternatives, including moving certain elements of production from Toronto to Montreal," says Bombardier. A slump in sales of the Dash 8 Q Series of 35- to 70-seat turboprops and the Global Express large business jet forced the company to suspend production of the aircraft.

This raises further questions about the long-term viability of the Dash 8, the order backlog for which has shrunk to 26 aircraft, including 10 Q400s. Annual production stands at 36 turboprops a year.

Deliveries of the newer Q400 prior to December's shutdown were sluggish, with just one aircraft delivered in the third quarter of last year and another 70-seater in Bombardier's traditionally busy month of December. A recent report by Merrill Lynch suggests there is a possibility of a Q400 writedown of capitalised excess production costs, estimated to be in the region of $200 million.

Bombardier says it remains committed to the programme, having recently sold three Q300s to Qantas and a single aircraft to Petroleum Air Services. There are unfilled options for another 49 aircraft.

Source: Flight International