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Bombardier, Other Aviation Issues, Regional Aircraft, UPDATES

UPDATE: Today Bombardier received another $1.5 billion to shore up its liquidity to keep its ‘pet’ projects (CSeries and Global 7000/8000) alive and breathing. Caisse du depot et placement du Quebec (CDPQ) the provinces largest public and private pension manager will take a 30% share in Bombardier Transportation (rail), as Bombardier prepares to burn through $US+1.0 billion next year on the CSeries (entry into service, production, and on every delivered aircraft which should be 20) and another $1.0 billion on the Global 7000/8000 in development and certification costs ($2.6 billion was spent on the failed Lear 85 – how ?). The CSeries is now 49.5% owned by the Province of Quebec, and you know where jobs will be going, as the medium term future of Downsview is now questionable (remember Canadair’s home airport of Cartierville ? sold to make a golf course and a residential area at a good profit to Bombardier) as the Q400 and CRJ lines are in their final 2-3 years of production, as backlogs for both are less than 130 (currently 5 x CRJ’s and 2 x Q400’s are being produced per month), you can do the math right ? They want federal money too as they make plans to send Q400 wing and cockpit work to Mexico as the product life cycle is firmly in the decline phase for both lines, and Quebec wants job guarantees for its stake in the Cseries. At some point in the next 2-3 years look for business jet work (inc. G7000/8000) going to Montreal. Why does the public put in money when the Beaudoin and Bombardier family control 54% of voting rights with 14% of equity ? and they are responsible for the current mess, company needs good corporate governance. The reality is that there are at best only “REALISTIC” 140 CSeries orders after 7 years of sales effort, Airbus was approached, Embraer was approached and no takers were found for the program and now they are stuck with it, slowly writing it down with huge losses. It is not only about the state of finances, but the segment (110 to 149 seats) it is positioned in, but also the huge discounting by Airbus and Boeing which will require +40% discounts by Bombardier to win any large order. Time to change the Board as you cannot solve your problems with the same people that created the problems in the first place, the Lear 85 was written down by $US 2.6 billion and the CSeries was written down by $US 3.2 billion, due to mismagement of both programs.The stock, (TSX:BBD.B) closed at $1.28 today down from $1.36 a week ago and down 70.3% from a year ago, a further drop of 22% and its a penny stock ! The financial markets are NOT impressed, everyone knows that its all a indirect BAILOUT as the company lost $4.9 billion last Quarter ($700 million without write downs) and now you have the Quebec Government in the CSeries program, and that is never good for any business as Canadian Governments have shown that they have NO idea how to run a business, we saw that with Canadair, de Havilland, Air Canada, etc. Lastly, no one discusses it but the BIG problem for the CSeries is that it will NOT make money in an industry discounting 40% off List Price today, and production of narrow body airliners is going to 125 units per month, and Bombardier plans 10 per month and it too will have to discount 40% down, making profitability at best a long term proposition, if ever.

Today Bombardier got another bail out from the Province of Quebec, this time by getting Caisse de depot et placement du Quebec (CDPQ),  Quebec’s long term public and private pension fund, to buy 30% of its Bombardier Transportation (rail business) for $1.5 billion (valuing the division at only $5.0 billion), on top of the recent $1.0 billion it received from the Province of Quebec for a 49.5% stake in the CSeries program.

It is time to start asking tough questions in Quebec about why the Bombardier and Beaudoin family still control 54% of the voting rights with only 14% of the equity ? Investors know who is to blame for the fiasco now underway at Bombardier, its is ex-CEO Pierre Beaudoin, and the Boad, which he is now Chairman of. Why is public money going into the company and no change in governance and accountability ? wake Quebec your tax payer money is being used to keep the  2 families in control, they have money so let them put put in more, I say NO to federal money going into that company till the 2 families control a minority of the voting rights, it is just the right thing to do, why reward those that mismanaged it ?

The latest investment has raised raises Bombardier liquidity to $6.5 billion, money that is needed for the CSeries which should burn through another $1.0 billion in 2016 as 1st CS100 deliveries are made, CS300 is certified and production revs up, and each delivery will loose millions of dollars for a long time.

Though NOT talked about by anyone yet, the program will be a financial loser for a long time, because of the price dynamics of the market, where discounts on A320/B737 aircraft from Airbus and Boeing are +40%, this Bombardier will have to do to win any big orders and has done already for existing orders, and the CSeries will NOT make a profit in such a competitive market, and Airbus and Boeing will do ALL to make sure Bombardier does not WIN any BIG airline orders, you can count on that. One only has to look at the buying power of Airbus and Boeing, you think Bombardier gets the discounts from suppliers the duopoly get ? no so unit costs are higher and price has to be competitive, a tough mandate in a tough market, especially when Airbus and Boeing are about to deal with new incumbents like the Irkut MC-21 and Comac C919, though nothing “game changing” they will force a “price war” in the narrow body market by 2019, and guess who the odd man is in that group of 5 ? 

The last announced cost of the CSeries program was $5.3 billion, though surely higher now, but the end of October $4.9 billion loss by the company for 3Q/2015 included a write down of $3.2 billion for the Cseries, which lowers its development cost to $2.00 billion and another $1.2 billion write down on the Lear 85 program, which already had a $1.40 billion write down when it was “paused” last year. How in heck did they lose $2.6 billion on the Lear 85 program ? that is total mismanagement, and the CSeries was $2.0 billion over budget at the same time, where was senior management for the past 7 years while they ran up cost over runs of $US +3.0 billion on the CSeries and Lear 85, and now having to write them down by $US 5.8 billion ? Yet, the Board is still there and the two families still control the company, why would any investor put money in with such inept top leadership running the show that has almost killed the company ? disgraceful indeed.

cs-paris-cs100 (1)

A lot of public money, and yet the company is till controlled by 2 families through the special voting shares ? with that kind of money raised it should have been a condition of funding that the Board and majority control of the company be changed, yet it is Quebec, which is infamous for its corruption from many corrupt Mayors in Montreal, sleezy construction and highway contracts to Lavalin doing business through big bribes around the world, and I guess one should have expected this as local businessmen are politicians are deeply very close, each dependent on the other, sad as it is, it is reality of business in Quebec, a mini-Russia.

The CSeries problems are not over, it still only has 140 ‘real’ orders, and the company will lose lots of money for each delivery for some time, no way in hell they will break-even by 2020 as they claim, even with the huge write down, which by the way was bigger than the market capitalization of the company (market value of the company) today. They plan to deliver 20 CSeries next year and finish CS 300 certification then slowly ramp up to 10 units per month, so at best they will deliver 20 in 2016, 50 in 2017, 80 in 2018, 110 in 2019 and 120 in 2020 that is a realistic production of 380, remember they have only 140 real orders, so they have to hustle to get new orders as their existing backlog is good thru 2019 at best, but break-even will not be easy and NO WAY by 2020 as Bombardier claims, because of heavy price discounting as Boeing and Airbus are planning about 125 units per month of their narrow body airliners (A320/B737) vs 10 by Bombardier, and the big boys have other products with which to make money with, Bombardier will NOT have any CRJ or Q400 revenue by 2019.

They joined the BIG league with Airbus and Boeing, a sort of NHL versus  the AHL and in the BIG league today, discounts on narrow body airliners brings the ‘real’ price down to $50 million for A320’s and B737’s in other words at least +40%. Bombardier will have to discount their LIST price of $US 82 million for the CS300 and $US 72 million for the CS100. To match Airbus and Boeing on a per seat price ($US +/-330,000), Bombardier will have to REALISTICALLY but not publicly price (what you read in press releases is based on list not real prices, that is very confidential information) their CS300 around $US 45 million and their CS 100 at around $US 38 million, which leaves $0 for profit and surely each units old will lose money for the a long time. This is the industry today, and while Bombardier now has liquidity the “elephant in the room” is price discounting in the industry, and the program WILL NOT achieve break even for a long time, if ever, without some fancy accounting in Montreal.

The CSeries is now a Quebec program, and all future jobs will go to Quebec at a time when jobs will be reduced at Downsview, Ontario as the Q400 and CRJ lines are slowly winding down and now probably in their final 2 to 3 (max) years of production, and even now wing and cockpit work on the Q400 is planned to go south to Mexico, and yet those leaders in Quebec still want the Canadian Federal Government to kick in at least $1.0 billion more ?

So Quebec ends up with 49.5% of the program that already received $700 million from the Canadian and UK governments back in 2008 or so when the struggling program was unfortunately resurected. I am also sure Air Canada based in Montreal is under intense pressure to order the CSeries from politicians and the business community, and do not be surprised when it does make an order, even though last year it said it was happy with its 45 x Embraer E190’s.

Still only 140 CSeries ‘real’ orders, and the high end business jet market is changing as Gulfstream’s new G500/G600/G650ER up the Bombardier G5000/G6000 and why their production rate is coming down as new models are ‘better’. By the way, for its investment, Quebec received job and no relocation guarantees for at least 5 years, so if you are a Bombardier worker in Ontario, you should be worried about your job.

The G7000/8000 market is a risk, you are now competing with Boeing’s BBJ’s and Airbus’s ACJ’s once you get to the $75 million range, and boy you get a whole lot of airplane when you buy a A320ACJ or B737Max model, a market segment that is not that big, 20-25 units per year, OMG another “hope” play by Bombardier that can destroy it if it gambled on the wrong market segment, like the 100-149 seat commercial market, where there are few annual sales today by Embraer, Airbus and Boeing, just look at the numbers, its not pretty. Lastly, its a must to have a North American CSeries order, Porter Airlines is out as is Republic Airways, so whose next ?

A new holding company was created, Bombardier Transportation (Investment) UK Ltd. with convertible shares that will give bond like protection on the downside to CDPQ and equity like access if profits grow, and its 30% common equity stake could fluctuate between a min. 25% of the company to aa high of 42.5% depending on how well the rail division does versus its business plan, but no matter what it is promised a minimum 9.5% return. This could be difficult, the rails side has its problems, presently late to deliver street cars to Toronto Transit Commission, it is being sued, while China’s 2 biggest rail firms merged earlier this year, and competition is going to be fierce across all segments, the future is not all bright and sunny as Bombardier likes to pretend.

As for reving up production, Bombardier still faces many unknown variables, is the supply chain ready after sitting and waiting for 2+ years while the company gets itself sorted out ?and unlike Boeing and its B787, Bombardier cannot afford any in service breakdowns, delays in deliveries or any breakdowns that are part and parcel of the business, and nothing ever runs 100% smoothly. The past few years have seen major problems at Airbus and Boeing with new aircraft and not having all suppliers and systems working as planned. Such a an issue with a fragile Bombardier, would have major consequences.

In the end, I still believe that the program will end up in Chinese hands, I believe sales will continue to struggle in a very price competitive market that will have for the first time in a long time 5 players in the 120 to 200 seat market (Airbus-A320neo line, Boeing-B737Max line, Bombardier-CS300, Comac-C919, Embraer-E195E2 and Irkut-MC-21) and not all will be successful.

TSXBBDB Nov 192015

Bombardier Stock (TSX:BBD.B ABOVE GRAPH)) in the past 6 months has been a slow slide downwards, NOT anything investors are lining up to invest in for sure and as you see from above graph, only in September did the stock value go up on the ‘phony’ news that a Chinese company wanted to buy Transportation for $US 8.0 billion and that United Airlines as interested in possibly buying a great deal of 100+ seat airliners IF pilot union agrees to a new deal, in other words a “ruse” also tried by Delta in March, where the pilots rejected the deal and Delta’s CEO Anderson cancelled its aircraft order.

I do not expect pilots at UA to agree to extending current contract, as North American airlines are making LOTS of money this year, best year ever, and after years of concessions by UA unions its time to claw back some of what they have given up in the past 7 years, but let Bombardier dream, anyway UA has its third CEO in 3 months (one quit under federal criminal investigations for ‘funny business at Newark Airport, second fell ill) so they have leadership and trust issues with employees to deal with.

Today the stock was up for awhile on the CDPQ news hovering around $1.35 a share, but closed down at $1.28  (down 70.3% this year from $4.29 one year ago today), another 22.6% drop and it is at $0.99 a penny stock !

Let’s see where it all goes, till next time, always interesting !

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About Aviation Doctor - Helping aviation companies to transform the present into a more profitable tomorrow

I am a Canadian and EU national with an MBA and 33+ years experience in aviation business development with 20 years overseas and work in 25+ countries. A former investment/merchant banker (mergers and acquisitions to corporate turnarounds). airline and OEM senior executive and past owner of 6 successful aviation companies in 3 countries (executive jet charter/management companies, aircraft sales, aircraft broker, airline/aerospace consulting to aircraft insurance). I have a very diverse aviation background with 75+ aviation companies (45+ airlines of all sizes, OEM's, airports, lessors, MRO to service providers) as consultant, executive management, business analyst and business development adviser. Excellent success track record in International Business Development. Most work with airlines is with new start-ups and restructuring of troubled carriers. I sold new business jets, turboprops and helicopters for Cessna, Raytheon, Gulfstream to Eurocopter as an ASR as well as undertaking sales and marketing of commercial aircraft for Boeing, de Havilland, Dornier, Saab and Beechcraft. Brokered everything from LET-410's to B747's and from piston PA31 to G550 business jets. I look beyond the headlines of the aviation news and analyze what the meaning and consequences of the new information really means. There is a story behind each headline that few go beyond. Picked the name Aviation Doctor, as much of my work has been with troubled companies or those that want and need to grow profitably. I fix problems be in the business, and help with restructuring for a better tomorrow. You can reach me with comments or suggestions at: Tomas.Aviation@gmail.com and I comment a lot on Google+, my Facebook and LinkedIN.

Discussion

3 thoughts on “UPDATE: Today Bombardier received another $1.5 billion to shore up its liquidity to keep its ‘pet’ projects (CSeries and Global 7000/8000) alive and breathing. Caisse du depot et placement du Quebec (CDPQ) the provinces largest public and private pension manager will take a 30% share in Bombardier Transportation (rail), as Bombardier prepares to burn through $US+1.0 billion next year on the CSeries (entry into service, production, and on every delivered aircraft which should be 20) and another $1.0 billion on the Global 7000/8000 in development and certification costs ($2.6 billion was spent on the failed Lear 85 – how ?). The CSeries is now 49.5% owned by the Province of Quebec, and you know where jobs will be going, as the medium term future of Downsview is now questionable (remember Canadair’s home airport of Cartierville ? sold to make a golf course and a residential area at a good profit to Bombardier) as the Q400 and CRJ lines are in their final 2-3 years of production, as backlogs for both are less than 130 (currently 5 x CRJ’s and 2 x Q400’s are being produced per month), you can do the math right ? They want federal money too as they make plans to send Q400 wing and cockpit work to Mexico as the product life cycle is firmly in the decline phase for both lines, and Quebec wants job guarantees for its stake in the Cseries. At some point in the next 2-3 years look for business jet work (inc. G7000/8000) going to Montreal. Why does the public put in money when the Beaudoin and Bombardier family control 54% of voting rights with 14% of equity ? and they are responsible for the current mess, company needs good corporate governance. The reality is that there are at best only “REALISTIC” 140 CSeries orders after 7 years of sales effort, Airbus was approached, Embraer was approached and no takers were found for the program and now they are stuck with it, slowly writing it down with huge losses. It is not only about the state of finances, but the segment (110 to 149 seats) it is positioned in, but also the huge discounting by Airbus and Boeing which will require +40% discounts by Bombardier to win any large order. Time to change the Board as you cannot solve your problems with the same people that created the problems in the first place, the Lear 85 was written down by $US 2.6 billion and the CSeries was written down by $US 3.2 billion, due to mismagement of both programs.The stock, (TSX:BBD.B) closed at $1.28 today down from $1.36 a week ago and down 70.3% from a year ago, a further drop of 22% and its a penny stock ! The financial markets are NOT impressed, everyone knows that its all a indirect BAILOUT as the company lost $4.9 billion last Quarter ($700 million without write downs) and now you have the Quebec Government in the CSeries program, and that is never good for any business as Canadian Governments have shown that they have NO idea how to run a business, we saw that with Canadair, de Havilland, Air Canada, etc. Lastly, no one discusses it but the BIG problem for the CSeries is that it will NOT make money in an industry discounting 40% off List Price today, and production of narrow body airliners is going to 125 units per month, and Bombardier plans 10 per month and it too will have to discount 40% down, making profitability at best a long term proposition, if ever.

  1. The latest action by the Quebec government to commit $1.5 billion to the rescue of Bombardier Aerospace, in exchange of a 49.5% ownership of the company must be classified as the prime example among business investors of what not to do. And, as if this was not enough, Bombardier Aerospace has the nerve to approach the Canadian government this time, and ask for an additional $1.0 billion. On what grounds has the Quebec government invested such amounts to Bombardier Aerospace? And, on what grounds is the Canadian government about to commit the same mistake? Bombardier’s stock price was around $35 during Bob Brown’s days at its helm, but has deteriorated to about $1.40 nowadays. Have both governments understood the reasons behind Bombardier’s stock price drop? Have they realised that this drop is not only due to the failure of the C-Series program (a primary contributor) but also to the incompetence of Bombardier Aerospace management to run an aerospace company? Have they realised that the enforcement of “innovative” management practices and procedures, imposed gradually to the company ever since it was acquired by Bombardier Inc. around 1990 have eroded its capabilities to the extend that nowadays as an aircraft designer and manufacturer, is worth almost nothing (stock price was around $30 in May 1995, reducing to about $20 in May 2001, a drop of about 30% within 6 years and reaching close to penny-stock status in December 2014, which constitutes a drop of almost 90% within the following 13 years)?

    I shall not comment on the arguments of the previous contributors to this domain, which are totally correct in demonstrating that the C-Series program will fail to be a successful program for Bombardier. One point that did not strongly come out from these comments though, is the contribution to the C-Series failure of the management practices applied during its development and Bombardier Aerospace senior management persistence to apply a management model that has already shown its weakness. Since 2000, the only commercial aircraft program (as opposed to business aircraft program) in Bombardier, was the CRJ. Whithin this context, I would not consider the CRJ program (and that includes all derivatives made from CRJ-700 to CRJ-1000) to be a successful one and this is why:
    • The CRJ production line is about to close, having produced a total of about 800 a/c against the Embraer
    EMB-170/175/190/195 series, which has produced about 1400+ aircraft and is still going on, despite the fact
    that the Embraer aircraft became available in the market almost 3 years after the first CRJ-700 entered
    service.
    • Bombardier decided to commit the CRJ platform, to the development of aircraft for the regional market.
    Regional airline customers tend to plan an aircraft fleet consisting of increasing aircraft capacity (70/90
    /100/110 seats) but based on the same aircraft platform. Yet Bombardier started by offering the CRJ aircraft
    platform although they had proof that such a platform could not be easily stretched and maintain efficiency at
    the same time (the failure of the Douglas MD series in the commercial market, a platform that started from the
    DC-10, was already evident at the time this decision was taken by Bombardier senior management). If
    Bombardier’s strategic planning group was competent enough, they would have identified that for the CRJ
    platform, the CRJ-700 was about the limit of efficient stretching. And, obviously, they would have never based
    their regional aircraft series on such a platform.

    Since 2001 the helm of Bombardier Aerospace was held by P. Tellier, P. Beaudoin and A. Bellemare, in that order. All, except perhaps A. Bellemare, had no significant experience in the aerospace industry and made mistakes (especially P. Beaudoin), which can only be explained by their inexperience, incompetence or both and which mistakes drove Bombardier Aerospace to the state it is today. More significant than that is the fact, that a) they were never able to assess the implications of their mistakes (a fact compatible with their inexperience and incompetence) and b) they kept managing Bombardier repeating the same mistakes until the present days.

    P. Beaudoin, and to a much lesser extent P. Tellier approached aircraft development through the philosophy of starting on an aircraft project idea whithout much thinking at the early stages, but evolve the design over time until the product was finalized. This is known in the industry as a trial-and-error approach. Such an approach is reactive in nature, as opposed to proactive and lends itself nicely in environments were inexperience and/or incompetence prevail and need be camouflaged. It is inherently expensive and does lend itself to delays, depriving the manufacturer accurate product delivery estimates. (Bombardier Aerospace never delivered a early specimens of a product on time so far).

    But it also has its advantages. Since iterations in development are the building blocks of trial-and-error management techniques, such techniques can be supported by less skilful people, affording the company savings from hiring highly skilled individuals. Skilled individuals can act in a proactive way and minimize iterations. Ultimately, the economics of this design philosophy tend to favour the development of “cheap” engineering products but are definitely not adapted to the development of high-technology complex engineering products like an aircraft.

    A “cheap” product like a Ski-Doo, can be developed and offered at a competitive price in the market using the application of trial-and-error management techniques. But not an aircraft. Since 2000/2001, Bombardier tried to impose Ski-Doo development management techniques to aircraft design and development. Of course, with the disastrous results we all know today.

    The success of an aircraft program depends almost entirely to product requirements management from the early stages of the program. In layman’s terms, this means “understand the product and market it is targeting right from the strategic design phase”. The “understanding” consists of a) market analysis and market trends to a depth of at least five to six years to identify if the product will meet market requirements when it will be introduced, b) risk assessment based on technologies being incorporated on the new product and market trends, c) credibility of company ability to deliver the product (and that means the state of product definition during the strategic/preliminary phase when information about the development of the new product is “leaked” in the market), d) product breakdown structure and definition of packages, e) package engineering specification, f) product development timeline, g) identification of potential suppliers for the various packages and g) plan for controlling supplier progress. And this requires the right experience and competence from the teams mandated to complete the necessary tasks.

    Is Bombardier capable of successfully carrying out these tasks? Probably not. The partial success of the CRJ program and the “abandonment” of the regional jet market to Embraer, shows that their strategic planning methods and the people mandated to apply them are not up to the standards required for market domination.

    They started thinking of a platform replacement for a regional jet (BRJ-X) towards the 1999. Then they cancelled it. When they started considering the C-Series aircraft they went through a sequence of announcements first confirming the existence of the C-Series program, then its cancellation, then its development again. This sequence was maintained until finally the program was officially launched in 2008. All this did confirm their credibility in the market place, in that they understood the product and timeline they would be offering. The risk on the new program has also not properly been assessed, as it is indicated by the fact that they decided to introduce three high risk new technologies to the new design (engine, extensive use of composites on primary structures and a fly-by-wire flight control system), having not sufficient experience in any one of them. It did not come as a surprise that the introduction of two of these novel technologies were responsible for the long delays in the C-Series program. Let alone the cost overruns. And let us not consider supplier control, which was non-existent, letting the supplier impose its pace to the program development schedule. And, let us not forget the following demonstration of Bombardier management incompetence. Bombardier launched and worked almost simultaneously on three programs, the C-Series, the Learjet 85 and the Global Express 7000-8000. Among these, the C-Series is running full speed ahead towards failure, the Learjet 85 was cancelled (wonder why) and the Global Express 7000-8000 is being delayed in “preference of supporting the C-Series entry into service”. Is this the real reason, or the aircraft has slipped its development schedule anyway?

    Yet the question remains. Doesn’t Bombardier have the ability to form a competent management team and cure all these problems. Of course it does. Competent, very good people do coexist in Bombardier together with incompetent ones. Therefore why these competent people are not given the right roles and responsibilities, so that these problems are eliminated? The answer to this question is again rooted to the Ski-Doo management philosophy imposed since years to Bombardier. The incompetence and/or inexperience of Bombardier senior management in aerospace, also does not allow them to understand the roles and responsibilities of management personnel required to fill positions at lower management level. It is therefore impossible to create a correct management structure, even if the people who would successfully fill these positions exist in the company. In fact, if someone within Bombardier, in the spirit of good constructive discussion, identifies problems with the way the company is being managed that do not agree with senior management directives, he is immediately demoded. He will be either a victim of the “next Bombardier restructuring” or he will be intimidated by placement to an obscure post condemned to execute his hierarchical supervisor’s instructions without question. The advancement of an individual in Bombardier Aerospace depends on whom the individual knows and not on his ability.

    In conclusion the Bombardier Aerospace environment consists of:
    • An incompetent and/or inexperienced senior management, having adopted a management system that is far
    from being suitable for an aerospace firm.
    • Incompetent middle management.
    • Inexperienced junior management (mostly fresh out of university) and no mentors for them (how a person at a
    higher level can be a mentor if he himself needs menting?).
    • A team of very good and competent people residing at the employee level and waiting for either the next
    company “restructuring” deciding on their fate, or waiting patiently for the years to go by so that they may
    retire.
    • A team of equally good and competent technical people (but very few at higher levels of management) who
    ensure compliance to certification authorities (Transport Canada, FAA, EASA etc.) requirements. At least one
    is certain that whatever product flies out of Bombardier, flies safely.

    Against this environment and the future of the only unsuccessful (refer to the other articles on the C-Series in this blog) future revenue generator (C-Series aircraft), the Quebec government invested about $1,5 billion of taxpayers money, in an investment that guaranties no return. An it did so, as a minority holder of 49.5% of the company. Can the Quebec government explain the reasons behind this totally stupid investment decision?

    Against this environment the Federal government is considering to do the same. I hope they have already decided not to do so under the terms and conditions the Quebec government did.

    The Prime Minister of Canada and the Premier of Quebec, must not go about just providing liquidity to Laurent Beaudoin, with the excuse of securing employment and saving the prestigious aerospace industry in Quebec. If they really want to secure employment and viability of the aerospace industry in Canada they must:
    • Either provide funds in exchange of controlling rights in Bombardier Aerospace. Once gaining these rights,
    they must place a CEO with mandate to immediately introduce activities related in establishing a management
    system and structure that is compatible with an aerospace company.
    • Or they let Bombardier Aerospace go bankrupt, force Laurent Beaudoin to sell, therefore give controlling
    rights away, and then proceed to buy the company, which would have been reduced to a “penny stock” one,
    and subsequently act, as mentioned in the first bullet.

    In closing and to be fair, I would like to mention that A. Bellemare, recently appointed as Bombardier Aerospace CEO, may have the intention to actually completely change Ski-Doo management philosophy from the company and convert it to a model appropriate to an aerospace company. Such action may still save Bombardier Aerospace, but not the C-Series. So let one give him the benefit of doubt, he will be different than his predecessors. However, since he took over in February 2015, he hasn’t done much in this direction. A matter of priorities? Perhaps.

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    Posted by Pedro Lenzionis | December 5, 2015, 7:20 pm
    • Thank you for that insightful look inside Bombardier, you have a wealth of knowledge about the internal problems of the company, I can only judge the company from the outside, sales, financials, products, development and how things are shaping up in its business.

      I would like to put your comments as a separate blog article, with your permission, leaving out any email or or IP address, etc. of course, just a detailed analysis of the inner workings of Bombardier, a company many respect and sad to see it struggling with serious doubts about its long term viability.

      Kindest regards,

      Tomas

      On Sat, Dec 5, 2015 at 2:20 PM, AVIATION DOCTOR – Insights Beyond the Headlines wrote:

      >

      Like

      Posted by Aviation Doctor - Helping aviation companies to transform the present into a more profitable tomorrow | December 6, 2015, 8:15 am
      • Thanks for your short message Tomas. Please feel free to put my comments as a separate blog article. Also please accept my apologies for my late response to your request.
        Best regards
        Pedro.

        Like

        Posted by Pedro Lenzionis | December 12, 2015, 7:06 am
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