Bombardier signs second big jet deal
MONTREAL — Bombardier Inc. said its deal with Airbus has yet to ignite new sales discussions, but existing efforts have yielded results as the manufacturer announced back-to-back potential orders including one with Africa’s largest airline.
Chief executive Alain Bellemare told an investor conference Tuesday he fielded upbeat calls from some large airlines — including Airbus customers — hours after the deal was announced.
“That’s the reason why I’m convinced that we are going to see much better sales moving forward,” he said at the Goldman Sachs Industrials Conference in Boston.
Bombardier has signed its second potential C Series order in less than two weeks after EgyptAir Holding Co. announced plans to purchase up to 24 aircraft. The agreement announced at the Dubai Airshow includes 12 CS300 aircraft with purchase rights for an additional 12 aircraft.
Bellemare acknowledged the orders had nothing to do with Airbus even though the partnership gave customers added comfort that the European giant will put its full weight behind the C Series.
“This is very good, but it’s the work our team was doing with airline customers,” he told analysts. “It keeps on building the momentum up.”
Bombardier said that based on the list price of the CS300, a firm order for 12 aircraft would be valued at about $1.4 billion US. That would double if the airline exercises the 12 purchase rights. However, airlines typically receive large discounts.
“It would be difficult to wish for a better carrier to establish our presence in the region,” Colin Bole, Bombardier senior vice president commercial aerospace, said in a conference call with reporters from Dubai.
“It’s a great template and it is something that will be followed extremely closely by the other carriers in the regions and the sub regions in the area.”
The C Series has also been ordered by Iraqi Airways, Saudi Gulf and Gulf Air.
The national airline of Egypt told reporters in Dubai that while it has been studying the C Series for a long time, Airbus’ involvement makes them feel better about the program, Bombardier commercial aircraft president Fred Cromer added.
EgyptAir chairman Safwat Musallam said the planes will help the airline to modernize its fleet and better serve destinations in the Middle East and Europe.
Analyst Richard Aboulafia of the Teal Group SAID Airbus’ involvement will assuage fears that the C Series will be an “orphan” airplane because it will have the support of the European aerospace giant.