Bombardier secures EgyptAir orders
Bombardier sealed the second deal for its C Series jet since reaching an agreement with Airbus a few weeks ago that will allow the European aircraft maker to take control of the programme and help revive the fortunes of the narrow-body aircraft.
EgyptAir Airlines plans to buy 12 of Bombardier’s biggest variant of the CS300 jet and has options for a further 12, the carrier said on Tuesday at the Dubai Air Show. The deal is valued at $1.1bn before discounts.
The accord is a significant win for Bombardier, which gains another customer for its new jet less than a month after the company agreed to cede control of the C Series to Airbus in exchange for the European firm’s marketing heft and manufacturing expertise. The aircraft had been plagued by delays and cost overruns, and was hit recently with 300% tariffs in the US after a trade complaint by Boeing.
Bombardier CEO Alain Bellemare told analysts on November 2 that he expected sales of the C Series would accelerate following the deal with Airbus. Its presence is “adding confidence about the long-term success of the programme”.
That same day, Bombardier said an unidentified European customer was planning to buy 31 C Series aircraft with options for 30 more.
Bombardier has not sealed a major purchase since Delta Air Lines ordered 75 aircraft in April 2016.
The CS300 carries a list price of $89.5m, although discounts of 50% or more are common in the industry. The jet, the larger of two C Series versions, is able to carry 130 to 160 passengers.
Airbus has vowed to cut the aircraft’s production costs and secure thousands of new orders for the C Series, which Bombardier spent more than $6bn to develop. The C Series was two-and-a-half years late and more than $2bn over budget when it entered service at Deutsche Lufthansa’s Swiss International unit in July 2016. Swiss and Air Baltic, which began flying the CS300 in December 2016, have reported better-than-expected fuel efficiency, which is key to the jet’s appeal.
EgyptAir is also expected to unveil a deal for six Boeing 787 Dreamliners, said people familiar with the talks.
Airbus has also been in talks to secure a commitment from the carrier, the people said.
Egypt Civil Aviation Minister Sherif Fathy said in October that the government expected to pay about $3.3bn of the cost to acquire 45 aircraft.