News
Airbus to close Bombardier C Series acquisition ahead of schedule
June 15th 2018
Airbus plans to close its acquisition of a 50.01% stake in the Bombardier C Series Aircraft Limited Partnership (CSALP) early, on July 1, after obtaining all relevant regulatory approvals. Read More »
Under the new structure, Bombardier will retain 31% of the company and Investissement Quebec (IQ) will hold 19%. CSALP was initially established by Bombardier and IQ to allow Quebec to inject state funds into the financially struggling aircraft programme.
Due to the early closing of the partnership, Bombardier will still fund the cash shortfalls of CSALP, if required. They will be a maximum of US$225 million in the second half of 2018, up to US$350 million in 2019 and a maximum aggregate amount of US$350 million in the next two years.
CSALP’s headquarters, primary assembly line and related functions will remain in Québec, with the support of Airbus’ larger reach and scale. Airbus’ industrial footprint will expand with the Final Assembly Line in Canada and additional C Series production at Airbus’ manufacturing site in Mobile, Alabama, U.S.
The single aisle market is a key growth driver in the Asia-Pacific and represents 70% of the expected global future demand for aircraft. Ranging from 100 to 150 seats, the C Series is highly complementary to Airbus’ existing single aisle A320 Family, which ranges from 150-240 seats.
In the Asia-Pacific, C Series take-up has been slow. Australia’s Macquarie AirFinance has 40 CS300s in its books, Al Qahtani Aviation Company ordered 16 CS300s for SaudiGulf Airlines, Gulf Air will take ten CS100s and Korean Air has bought 10 CS300s.
Operators in the region have placed significantly more orders for Embraer regional jets and the C919 produced by Commercial Aircraft Corp. of China (COMAC) than C Series aircraft. Last week, China’s HNA Group signed a deal for 300 COMAC jets.
The C Series programme continues to ramp up. Having delivered 17 aircraft in 2017, Airbus and Bombardier aim to double deliveries in 2018. In the Asia-Pacific, Korean Air is the only C Series operator and to date has accepted five CS300s.
“This partnership extends our commitment to Québec and to all of Canadian aerospace, and we are very glad to welcome so many C Series teammates into the extended Team Airbus. The strength of the entire Airbus organization will be behind the C Series. Not only will that enable this outstanding aircraft to fulfil its market potential, but we are convinced the addition of the C Series to our overall aircraft product offering brings significant value to Airbus, our customers and shareholders,” said Airbus CEO, Tom Enders.
“The C Series is widely recognized as the most advanced and efficient aircraft in its class and this partnership will ensure its commercial success. Airbus’ unmatched global scale, strong customer relationships and operational expertise are necessary ingredients for unleashing the full value of the aircraft. Together, we will create tremendous new value and opportunities for airlines, suppliers, shareholders and employees,” said Bombardier president and CEO, Alain Bellemare.
In the interim, rival Boeing continues holding partnership talks with Brazilian OEM, Embraer. An announcement is expected in the second half of this year.
