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Bombardier targets emerging markets to avoid job losses

Plane-maker will campaign in countries like China and India to side-step layoffs and production slowdowns.


September 1, 2011
by The Canadian Press

MONTREAL—Amidst reports of potential layoffs due to a lack of new orders, Bombardier says it will target emerging markets for regional jets to avoid job losses.

Montreal-based Bombardier needs to win regional jet orders over the next three months to avoid production rate decreases and layoffs early next year, according to president of Bombardier Aerospace, Guy Hachey.

The world’s third-largest aircraft manufacturer says it will pursue campaigns in India, Indonesia, Malaysia, China and Africa.

Bombardier says that North American and European airlines, who have historically been the plane-maker’s biggest customers, are interested in updating their fleets, but uncertain economic conditions are hampering orders.

Its Brazilian rival Embraer has successfully targeted emerging markets whose economies continue to grow.

“They have had more success. They have been wining on those emerging markets and we have not to a certain degree,” says Hachey. “There is an opportunity for us to have a good year next year on the CRJ but I’m concerned and we will have to mostly likely make some decisions in the fall on the CRJ production rate if things don’t materially change.”

Bombardier recently reported that its net profits rose by nearly 53 per cent in the second quarter but economic uncertainty reduced regional aircraft order deposits and trimmed free cash, forcing the company to consider layoffs and production slowdowns to trim costs.

The company received 86 net plane orders during the quarter, compared to 29 a year earlier. Orders included 43 net orders for business aircraft (56 orders and 13 cancellations) and 43 orders for commercial planes.