DELIVERING CSERIES PLANES WILL BE BOMBARDIER’S MAIN OCCUPATION THIS YEAR.
BOMBARDIER FACES A REAL CHALLENGE IN GETTING ITS NEW AIRCRAFT TO CUSTOMERS BEFORE THE YEAR IS OUT
Last year was all about the CSeries’ first flight for Bombardier Inc. This year is all about delivering the actual airliner to actual airlines.
So no one expected the Montreal aircraft maker’s December announcement: Chet Fuller, its salesman in chief for the CSeries, was gone. Effective immediately.
That hardly seems like a good omen for the aircraft in development that’s struggling to find its market — particularly given the timing of Fuller’s departure.
The aircraft that first flew last Sept. 16 faces a formidable year. Bombardier is committed to completing a gruelling flight-test program involving five aircraft flying about 2,400 hours, while diagnosing and fixing the complex technical issues that will crop up.
The company will need to receive certification for the CSeries from demanding regulators and set up production at facilities around the world that will put the aircraft together, with final assembly in Mirabel before delivering the 182 airplanes in its firm order backlog.
Bombardier has insisted all of this will be completed within one year of that first flight — which is about nine months away.
A chorus of doubt has already been voiced about meeting that one-year deadline. Observers speculate first deliveries are likely to slip into early 2015.
So 2014 is shaping up as a crucial — and daunting — year for Bombardier.
Company president Pierre Beaudoin himself said in a wideranging interview with The Gazette in December that the CSeries flight test and delivery date are currently under review and a new “proper schedule” may be announced next month.
Of course, the CSeries is not the alpha and omega in Bombardier’s full agenda.
The business aircraft Learjet 85, also a brand-new plane, was supposed to have its own first flight in December but that was postponed and will now take place “in the next few weeks,” Bombardier Business Aircraft spokeswoman Annie Cossette said on Friday.
And as the largest rail manufacturer in the world, Bombardier has a lot riding on the recent shift in China’s focus from high-speed trains to commuter trains in the wake of a devastating 2011 crash that killed 40 people. Bombardier and several other rail equipment makers are also being investi- gated in Brazil over allegations of bid rigging.
But these challenges — even once the delivery of Montreal’s métro cars by year’s end is factored in — pale in comparison with the CSeries. Thousands of jobs in Montreal and many other cities around the world depend on that aircraft program, as does Bombardier’s future in aviation.
During his interview with The Gazette, Pierre Beaudoin weighed in on a variety of issues. Excerpts of that interview, by topic, appear below:
On the departure of Fuller, who was hired from GE three years ago:
“We felt it was time to make a change and we made a change.”
Because of lagging CSeries sales?
“It’s not about what was not working. We felt (his replacement, Raymond Jones) would be the right guy to lead this team. It’s a large team, he’s got lots of international experience, knows our company very well and the timing was right.”
Beaudoin deflected some analysts’ criticism that Jones comes from Bombardier’s private jet division and has no airline experience, a very different business than selling planes to rich people and corporations.
“What’s important to lead a sales force is your leadership skills. Ray has demonstrated ... his ability to manage a broad network of sales people. ... From the product perspective, airplanes are not different from a business jet to a commercial aircraft. And he has an understanding of how Bombardier works on the inside. He has no airline experience, but that’s the part that with his sales team — which has a lot of airline experience — he’ll learn very fast and develop his own relationships.”
On the CSeries’ prospects:
Bombardier has set a target of 300 firm orders from at least 20 customers for the plane by late this year. It currently has 182 orders from 16 clients, and a total of 419 commitments of various types.
“I’m very confident we’ll get to our 300. You know, it’s normal there’s questioning of a new program in main line (carriers). There’s no other company that has done that since Airbus (when it introduced its A320 family in 1987).”
On the flight-test program:
“It’s (going) according to our plan. A second airplane will fly within weeks. (FTV2’s first flight was on Friday.) We’ll take the appropriate time to evaluate what the proper schedule is for the CSeries, and that’s what we’re doing now.”
On the agreement with Commercial Aircraft Corporation of China, Ltd., which would identify opportunities for common systems and procedures between the CSeries and COMAC’s larger C919 aircraft, also in development:
“An area of focus is the flight deck, especially the human interface (screens, dials, knobs and switches, etc.) Also, we’re looking at common ways to do maintenance and servicing ... as well as areas our sales forces could work together.”
On a breakthrough order for the CSeries that opens up the Chinese market for the airliner — Asia is set to overtake North America and
Europe as the world’s largest aircraft market:
“We recently sold 15 CSeries to China Development Bank, a leasing company. That’s good news because leasing is very important for airlines. It was signed by the president of China (Xi Jinping) in the presence of Canada’s Governor General (David Johnston). It’s a sign to Chinese airlines that this aircraft will be supported at the highest levels in China. We wanted the president to sign it and he agreed to do it. Now we can approach airlines and say, ‘You’ll get support.’ You don’t get any higher than the president of China.”
“Airlines there look for two things: leasing planes and whether the government will support their demand. Because once they agree to buy your airplane, they have to submit that to the authorities. ... So this signature (by Xi Jinping) was a good confirmation.”
On the fly-by-wire system, an electronic system that replaces many flight-control functions that were once done manually — and a particular area of concern for Bombardier:
“No worries, but we have a lot of focus on it. It’s the first time Bombardier has a fly-by-wire airplane, so there would be more attention than other systems because it’s still a learning process for us. ... It’s always a back and forth (with suppliers Rockwell Collins and Parker Hannifin), and sometimes we’ve made changes that they have to adapt to and sometimes they want to make changes. ... But I think we’re working very well as a team. ... I have 100 per cent confidence that we’ve done our work from a safety perspective.”
On the Montreal métro contract:
“It’s on track, manufacturing starts in February (at La Pocatière) and the first deliveries will be by year’s end. I’m upbeat about it, it’ll be exciting when it starts operating in Montreal.
“We’ve really put these new cars through some challenges before they enter service. ... We’ve been very supportive of the (Société de transport de Montréal).”
On the astonishingly candid statements by Rusdi Kirana, president of Indonesia’s Lion Air, who said he wanted to buy up to 100 CSeries and be the launch (first) customer for the CS300 version, the bigger CSeries — and that he hoped to place a large order at the Farnborough air show in July. Observers have cast doubts on that plan, saying it’s more wish than reality:
“I think he’s quite serious. ... Others are in Asia as well, like Air Asia. Because they’re all going after the same model — low-cost airlines with 165170 passenger-type aircraft. But now they’re also saying: ‘Yes, but if we want to be competitive over the long term, what can we do differently?’ That’s what the CSeries permits airlines to think about ... less seats, more frequency. Instead of three flights a day (on larger planes), you can have six CSeries flights a day. And then you can really hurt the competition. Because if you travel and you’re not sure about your schedule, you’re going to go with the airline that offers the most frequency.”
On the rail market in China, which had planned for staggering figures of dedicated high-speed tracks — up to 20,000 kilometres at one point. That was scaled back after the accident and accusations of corruption, but industry sources in China say the growth has largely resumed. Bombardier has supplied trains, métros and components to many joint ventures it signed with Chinese rail companies.
“They’re evaluating whether they need more high-speed trains. But their big focus right now is on commuter trains, about 160 kilometres an hour. And that’s good for Bombardier because we’re very strong in commuter trains around the world. And they have a new thing: They want more (lighter) aluminum trains. We produce aluminum trains all over the world, but not in China. So we’re designing a new (250 km/h) aluminum train there. And we’re starting soon the delivery of the (380-km/h very high-speed steel) Zefiro train that’s in tests right now.”
On the development of the Global 7000 and 8000 business jets that will be at the pinnacle of the private jet world — competing with Gulfstream’s G650. The two have long engaged in one-upmanship dogfights, each successively trumping the other’s aircraft range and performance. Steven Spielberg, Oprah Winfrey, the Aga Khan, Guy Laliberté and other billionaires own Global aircraft, while many other celebrities and corporations fly Gulfstreams.
“We’re about mid-stream in development. ... We’ve done a really good job in product positioning. ... Our main competition (Gulfstream) has the 650, which offers 7,000 nautical miles (non-stop) at .85 Mach (85 per cent of the speed of sound, or about 1,041 km/h). “We have a 7,000-nautical-mile airplane, but with three metres more cabin. ... And if the customer says, ‘I want the same size as the current Global (6000) or the G650,’ we not only offer 7,000 miles, we offer 8,000 nautical miles (with the Global 8000 due out in 2017). So we’ve got the competition really boxed in well. It’s a category addressed to billionaires, of which there are 1,300 in the world. But that’s predicted to double in the next 10 years worldwide.”
On being investigated with other firms in Brazil, part of a probe into an alleged cartel that rigged bids on train contracts:
“We have training on our code of ethics, so employees understand what we tolerate and (do) not. We have very, very disciplined procedures to approve an agent that would work with us. ... We work with (Canadian) embassies ... to understand local practices and so on.
“It’s one thing to have that in writing, but we tell our executives, ‘It’s how you behave everyday, too, how you’re seen in the smallest ways that will make a difference.’
“Now we’re a global company with 75,000 employees. ... You can’t be naive and say there’s never going to be any (corruption) issues.
“There’s an investigation in Brazil and we’re all over it — to really understand what happened and how to correct it. We’re still in the investigation phase internally. ... Like always, if there was something that happened, there will be no compromise. We will take action.”