‘Unforeseen challenges’ not derailing turnaround plan: CEO

More than two years into its five-year turnaround plan, Bombardier Inc.’s chief executive said the company is on track to achieve its goals by 2020 as it focuses on the profitability of its transportation and business jet units while preparing to give Airbus SE the reins to the CSeries program.

Chief executive Alain Bellemare told analysts at Bombardier’s annual investor day conference in New York City that the firm is preparing to shift from a period of investment, which included significant funding of its marquee CSeries program, towards a growth cycle that will see increased revenues across its divisions.

“Major risks have been retired, the path forward is clear, and we are starting to deliver solid financial performance,” Bellemare said Thursday. “Despite some unforeseen challenges and difficult markets, I am very proud of the work that the team has done so far. We know that we have more to do.”

Bombardier said the ramp up of transportation projects and an increase in CSeries deliveries will help increase revenues in 2018 as the firm nears the midway point of its turnaround plan, launched in November 2015.

Bombardier, which records its finances in U.S. dollars, is targeting revenues between $17 billion to $17.5 billion for 2018, an increase of approximately $1 billion from last year but less than analysts expectations, according to Thomson Reuters.

Bombardier estimates that its transportation division — its most profitable segment — will see revenues rise to $9 billion in 2018 and $10 billion by 2020.

The transportation unit is expected to face increased competition due to a pending merger between Germany’s Siemens AG and France’s Alstom. But Laurent Troger, the head of Bombardier Transportation, said the group is “better prepared for any type of consolidation” because of its recent business transformation.

With its business aircraft unit preparing for the launch of the Global 7000 jet, Bombardier said revenues will rise to $5 billion in 2018 and $8.5 billion by 2020, helping offset a potential revenue loss due to the CSeries program coming under Airbus’s control.