Airbus seals C Series plane deal
Airbus has sealed its control of Bombardier’s C Series, ushering in a new era for a plane with cutting-edge technology but a spotty sales record.
montreal — Airbus sealed its control of Bombardier’s C Series, ushering in a new era for a plane with cutting-edge technology but a spotty sales record.
The European planemaker will hold a majority stake in the partnership, with the deal set to close and take effect July 1, according to a statement on Friday.
All regulatory approvals have been obtained.
Airbus’s takeover of the C Series sharpens a clash with Boeing for dominance in the lucrative market for single-aisle jetliners. Bombardier CEO Alain Bellemare has predicted that C Series sales will accelerate because of Airbus’s marketing reach, while costs will drop thanks to the European planemaker’s clout with suppliers.
Boeing is seeking to forge a commercial-aircraft alliance with Brazil’s Embraer, Bombardier’s main competitor.
Canada’s biggest aerospace company designed the C Series to crack the Boeing-Airbus duopoly in single-aisle commercial aircraft. But the Montreal-based manufacturer was more than two years late and about $2 billion over budget in developing the plane.
Bombardier struck the deal with Airbus in October in the midst of a bitter trade dispute in the US with Boeing, which complained the Canadian plane had received illegal government aid that helped it undercut competitors in a sale to Delta Air Lines. Bombardier won relief in January when the US International Trade Commission ruled that American industry wasn’t being harmed by the C Series.
Bombardier spent more than $6 billion to develop the C Series after launching it in 2008, equipping the aircraft with fuel-efficient engines, large windows and a wider-thanusual middle seat.
Passenger capacity ranges from 108 to 160, a step up in size from Bombardier’s signature regional jets. In exchange for taking control of the plane programme, Airbus has agreed to provide procurement, sales and marketing expertise to the C Series Aircraft Limited Partnership, the entity that manufactures and sells the jet. Executives of Airbus have said they would look to extract savings from all C Series suppliers to lower the programme’s production costs.
Airbus shares fell 1 per cent to €98.66 at 9:10am in Paris, giving a market value of €77 billion ($91 billion).
Airbus has pledged to keep the headquarters and primary assembly of the C Series in Mirabel, Quebec. The companies are planning to build a secondary plant in Alabama — adjacent to an existing Airbus facility that builds the A320 narrow-body — to serve US customers. —