PARIS CHANCE
Bombardier’s CSeries is billions of dollars over budget and years behind schedule. At next week’s Paris Air Show, the company hopes to turn its struggling fortunes around
Bombardier’s CSeries planes finally have their big coming out party at next week’s Paris Air Show — where the company’s new executives are hoping to land some deals, or at least create some much-needed buzz.
The show, held every two years, is the first time the all-new CSeries planes, billed as quieter and more fuel efficient than rivals, will be on public display.
It’s a chance for Bombardier to try to turn around the struggling CSeries program on one of the industry’s biggest stages, where all the key players in the aerospace industry meet to do multimillion-dollar deals.
While the Montreal-based company is lowering expectations, saying orders are not that critical, it is desperate to build momentum for a program that is more than two years behind schedule and $2 billion (U.S.) over budget.
It has slashed thousands of jobs in the past year, including 500 at Toronto’s Downsview plant, where the Q400 turboprops are built, to cut costs.
Swiss International Air Lines, the first CSeries customer, isn’t expected to fly the new CS100 plane until the first half of 2016.
At the Paris show, visitors will be able to board the CS100, the smaller of the two, outfitted in the Swiss livery and full interiors and different economy seat configurations, while the CS300 plane will fly each day.
Fred Cromer, recently appointed president of Bombardier Commercial Aircraft after a huge management shakeup, said the company will also release aircraft performance information, collected during the flight test program.
“We see more positive improvements than the original brochure,” he said.
“We are very confident that the airplane is going to do what we said it would do.”
FRED CROMER PRESIDENT, BOMBARDIER COMMERCIAL AIRCRAFT
“We are very confident that the airplane is going to do what we said it would do, and there will be some improvements that we will speak to at Paris.”
That would be unusual because first deliveries of new aircraft tend not to live up to performance promises, because engineers build in extra caution, which can mean extra weight.
According to Bombardier, during one 7 1⁄2- hour flight test, pilots reported that there was still enough fuel left for another two hours.
Even if the plane’s performance results are better than anticipated, Bombardier’s biggest challenge remains winning orders for the CSeries, whose program budget is now $5.4 billion.
Bombardier has orders and commitments for 603 CSeries aircraft, of which only 243 are firm orders. Porter Airlines has placed a conditional order for a dozen CS100s, but it’s essentially on hold until city council decides whether to grant a runway extension and lift the ban on jets at Toronto’s island airport.
Bombardier has insisted it is on track to meet its target of 300 firm orders at the time of entry into service.
Meanwhile, rivals Boeing and Airbus, which are re-engineering their respective 737 and 320 aircraft, have been landing thousands of orders.
An engine fire last summer grounded the CSeries fleet for months, which meant Bombardier could not take the plane to the Farnborough International Air Show, which runs opposite years from the Paris show.
Cromer tried to downplay hype surrounding the CSeries’ appearance, noting Paris is just another industry event.
“I don’t think Paris is going to make or break this program,” he said, noting Bombardier now has new leadership with CEO Alain Bellemare, who took over in February.
Cromer and Colin Bole, new vicepresident of sales and asset management, have been making the rounds, attending a meeting of airline executives in Miami this week.
Bole said the Paris show is a chance to showcase the aircraft. “I think it will create a large amount of mo- mentum,” he said. “Not every airline executive has the time to go to Mirabel to see our aircraft . . . We certainly expect a bit of a wow factor there.”
But George Ferguson, a senior aerospace and airlines analyst for Bloomberg Intelligence, cautioned that while Bombardier would like to announce some orders in Paris, it’s the hometown of rival Airbus, which often dominates with order announcements.
“It would be great to get some traction,” he said.
“Airplane buyers are always excited to look at shiny new airplanes, but it boils down to price.”
The recent drop in crude oil prices has made used aircraft, which are less fuel-efficient, more attractive, Ferguson noted.
“It’s hard to see people pony up to pay the new sticker price in this size category, when there is a lot of used stuff available,” he said.
And it’s not just the price of the airplane, there is also the cost of integrating the CSeries into existing fleets — from pilot training to maintenance. Ferguson says if Bombardier doesn’t win any orders at the show, it won’t spell the end of the program, but it does need to win orders this year.
“What I am waiting to see is some more orders from bigger, wellknown clientele — big, expanding, low-cost carriers, big full-service carriers — people who could add to the fleet significantly that may be starting with an order,” he said.
“A Paris win could even be a small order from a growing airline,” Ferguson said.
Cromer, who has only been in his post for four weeks, says the CSeries is getting interest from around the world, including the Americas, Europe, Asia and the Middle East.
“We are seeing interest from all types of carriers. It is not just the flag carriers, the legacy carriers, or regional carriers,” he said. “It’s also the low-cost carriers. It’s also the charter carriers.
Smaller carriers such as air Baltic, Odyssey Airlines and Republic Airways are among those with confirmed orders for the CSeries.
“Everybody sees something in the CSeries that could be of interest to them,” Ferguson said.