PLANT

Air Canada to purchase up to 75 Bombardier CS300s

But the Montreal aerospace company has also announced workforce cuts affecting 7,000 positions over two years.

February 17, 2016   by CANADIAN PRESS

MONTREAL — Air Canada has signed a letter of intent to purchase 45 of Bombardier’s CS300 aircraft with options for an additional 30 planes.

Based on the list price of the CS300, Bombardier says a firm order would be worth about $3.8 billion.

Once a firm purchase agreement is in place, Bombardier says Air Canada will become the first mainline, international North America-based carrier for the C Series family of aircraft. Deliveries are scheduled to begin in 2019.

With this agreement, Bombardier says it now has orders and commitments for a total of 678 C Series planes.

Advertisment

The agreement with Air Canada was announced by Bombardier at the same time it said it would cut its workforce by 7,000 positions over two years, including 2,000 contractors.

Most of the job losses will be in Canada and Europe and will be partly offset by hiring in certain areas, including the C Series project.

The Montreal-based aerospace and rail equipment company says the job cuts will begin in the coming weeks and they will be completed by 2017.

Bombardier has just ended a difficult fiscal year as it releases what are expected to be weak financial results.

It could be poised to have lost more than US$4 billion in 2015 on lower sales and charges. Adjusted profits, excluding one-time items, are forecast to drop in half in both the fourth quarter and over the full year, according to analysts polled by Thomson Reuters.

Bombardier is forecast to earn US$37.3 million – or two cents per share – in adjusted profits on US$5.48 billion of sales in the quarter, and $342.2 million – or 17 cents per share – on $18.78 billion of revenues for the year.

© 2016 The Canadian Press