Bombardier CSeries on the last lap to certification

Over 90% of testing complete, but lack of more orders worries analysts and investors

As a struggling Bombardier shops around for investors, the company has announced its CSeries aircraft program is on track for certification this year, with more than 90 per cent of tests completed.

“It’s a thrill to announce that we’re in the final stage of certification,” Fred Cromer, president of Bombardier Commercial Aircraft, said Wednesday in a news release.

Test planes are doing the final reliability and function tests, including mimicking airline flight routes, such as flying from Toronto to Vancouver and back to Halifax.

Production has also begun on aircraft for Swiss Air Lines. The airline is expected to take delivery of the first plane next year.

What worries analysts and investors is that lack of more orders. The last one came more than a year ago.

Bombardier has 603 orders and commitments, but only 243 are firm. That falls short of its target of 300 firm orders by entry into commercial service.

“We all wake up every morning and get these Bombardier emails and hope we open them and find a CSeries order, and we don’t,” said George Ferguson, senior aerospace analyst with Bloomberg Intelligence. “Each and every day that passes, it is more concerning.”

Adding to that was news last week that Bombardier approached rival Airbus about selling a stake of the CSeries program. Both companies confirmed the talks, but said no further discussions were planned.

Other reports have said Bombardier will approach Embraer and Boeing, too.

Bombardier spokeswoman Marianella de la Barrera said the company is looking at various options, though she wouldn’t discuss specifics. “We are exploring initiatives and potential participation in industry consolidations are something we have considered.”

Bloomberg’s Ferguson said it doesn’t make sense for a deal with any of the three aerospace manufacturers, especially because the 100- to 150-seat is on the lower end of Boeing and Airbus products.

“Why would you want to add a product that puts you in a market that is much more competitive?” Ferguson said, adding manufacturers want to sell the benefits of their cockpit and maintenance commonality. “Adding another airplane doesn’t help.”

Embraer has a 100-seater plane that overlaps with the smaller CSeries plane, but opted not to compete with Boeing and Airbus in the larger plane market.

Ferguson speculated that Bombardier may be close to a deal with an investor, possibly in China, but is approaching the likes of Airbus to help determine the company’s value.

And for Airbus, he said, why wouldn’t the company listen to what Bombardier has to say, especially if the books were being opened for a peek.

“If you were Bombardier management, and you were getting close to an investment from anybody, you might want to benchmark what your other opportunities are. This could be a sign that something else is brewing somewhere else.

“But before we seal that deal we’re going to see what other interested parties might be willing to offer. That would be the right thing to do for the shareholders,” Ferguson said.

He doesn’t believe Bombardier is in desperate need of a cash injection, though it may become clearer when the company releases its third quarter earnings this month.