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JULY 2018

Week 27

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Airbus formally takes control of C Series, lists CS100 and CS300 in line-up

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July 6th 2018

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On July 1, Airbus, Bombardier and Investissement Québec confirmed the closing of the previously announced C Series transaction. Read More »

Airbus now owns a 50.01% majority stake in the C Series Aircraft Limited Partnership (CSALP), while Bombardier and Investissement Québec own approximately 34% and 16%, respectively.

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.

Following the July 1 transaction, Airbus formally added the CS100 and CS300 to its portfolio of commercial aircraft. The OEM lists the CS100 as typically seating 120 passengers over a range of 3,100nm. The CS300 is listed as seating 130-140 passengers over a range of 3,300nm.

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 and Korean Air has bought 10 CS300s. Gulf Air has ordered 10 CS100s, but last week said it did not plan to take delivery of them.

Operators in the region have placed significantly more orders for Embraer regional jets and the C919 produced by Commercial Aircraft Corp. of China (COMAC). In June, 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, 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.

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