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CRJ-1000

This tag is associated with 6 posts

SUMMARY: Beautiful, high technology aircraft are great, but do NOT guarantee commercial success, in the end its about meeting customers’ needs rather than on selling a ‘product’, and here lies the problem with Bombardier’s CSeries sales. The company came out with its so-called “game changer” in July, 2008 (yes 9 years ago and yet only 320 orders today), with claims it is 20% more fuel efficient and has 15% lower cash operating costs than currently produced aircraft with a fantasy forecast that 7,000 aircraft over 20 years will be delivered in the 100 to 150 passenger segment ? and it all sounded like they had a “winner”. BUT with low fuel prices and interest rates and airlines up-gauging from smaller 100-150 passenger airliners, the CSeries ‘benefits’ have fallen on deaf ears with airline executives, unless a huge +65% discount is offered to make the deal (e.g. LH, DL, AC, etc.), yet the only CSeries deal done in the past 12 months since the hugely discounted 75 x CS100 deal with Delta Air Lines (Loss to Bombardier of $+/-525M), has been 2 x CS300’s to little known Air Tanzania ? Meanwhile Airbus has accumulated 5,056 orders for its A320neo line and Boeing’s Max line has 3,703 orders. Is there a lesson here for OEM’s ? Off course, “don’t count your chickens before they hatch”.

Check out previous Articles on Bombardier, Commercial Aircraft, Low Cost Airlines, General Aviation, Regional Airlines to Airline Management and Mergers and Acquisitions https://www.linkedin.com/in/tomas-chlumecky-3200a021/recent-activity/posts/   We forget that high tech fantastic aircraft do not add up to commercial success (PHOTOS BELOW: Concorde (Mach 2+ airliner), Canada’s Avro C-102 Jetliner (2nd jet airliner to fly after the … Continue reading

SUMMARY: Bombardier is looking into upgrading its CRJ line, which after +1,864 deliveries is now down to around +/-58 orders at best in backlog or 14 months of current production (April, 2018). The sad reality is that the CRJ is no longer very competitive against the current Embraer E175 and the new E175/190-E2’s will make the CRJ obsolete, in fact since 2003 it has been in decline and losing market share to Embraer for 14 years and the order backlog is now “critically” low. After having upgraded the CRJ cabins in 2016, now the focus is on possible new engine (unknown at this time), but that is an expensive upgrade versus the current GE CF34 engines, and adds weight, which for a long fuselage aircraft like the 119 foot long CRJ-900, with rear mounted engines is not good for C of G issues. With only 19 CRJ orders in 2016, Bombardier has been milking and living off its backlog, but is there any life for the CRJ really ? even after +/-30% discounts off list price, sales are not impressive anymore. The CRJ is a 1970’s Canadair CL-600 Challenger (the Type Certificate for all CRJ’s), stretched 4 times with a tight cabin width of just 8 feet and 5 inches (2.69 meters) that has been become a 50 then 70 then 85 and finally 104 passenger airliner, while Embraer designed and built the EJets from scratch, and that is now paying off got Embraer and blowing up in Bombardier’s face. At a time when the CSeries is still struggling for orders, Bombardier Aerospace needs all of its products to sell and sell, yet the Learjets, Challenger 650, Global G5000/6000, Q400 and CRJ are sadly in the final decline phase of their product life cycle as new competing products are coming online across all segments..

Follow up to the January 4, 2017 Blog “Lots of Talk about Bombardier’s turnaround”   Bombardier is now looking for solutions to keep its CRJ line open for a couple of years as the backlog now dwindles to 14 months at current production rate of 4.2 per month and current order book. Now paying for … Continue reading

SUMMARY: Lots of talk about Bombardier’s Turnaround, 14,500 layoff announcements this year, or 21,450 in the past 3 years. The Global G7000 flew for the first time and Bombardier expects big things from it to boost Bombardier’s bottom line along with the struggling CSeries, which today still has only 320 orders (NO 40 x CS300’s for Republic Airways, just PR not wanting to reduce the meager order book) and still +/- 86 “questionable” orders (representing 26% of the current 320 orders). Lots of effort in reducing labor costs, yet no one is noticing that the top line (revenue) at Aerospace is a coming disaster, and unsustainable with an old product line (1970’s Learjets and Canadair CL-600/Challenger 650, plus the Global G5000/6000) that is facing new and better competition. The CRJ line has no more than 48 orders in backlog, only 18 orders this year (50% from Canada) good for 12 months of production (February, 2018) with no new orders. The Q400 is down to around 34 orders in backlog and only 25 orders this year (50% also from Canada), good for 14 months (March, 2018) with no new orders. The 2020 Turnaround Plan calls for Aerospace to generate $15 billion in revenue (60% of total revenue planned of $25 billion), with just 2 products ? The Plan requires $5 billion from Commercial aircraft, which by 2020 means only the CSeries (CS100/CS300) is left, and that will require at least 140 deliveries at the current highly competitive low prices to hit the “target”, really ? (2020 production is planned at 90-120 aircraft today). Meanwhile, Business jets are to generate $10 billion by 2020, and that will fall on the $75 million Global G7000 (NO Learjets, Challenger 650 and Global G5000/6000’s by 2020) and that means 133+ G7000 deliveries to hit their “target” ? seriously ? has anyone looked at single aisle ACJ and BBJ sales for the past 15 years ? (+/- 15 a year at best). Canada is providing “state aid” (aka taxpayers money) to Bombardier again ($2.5 billion in 2016 from Quebec), in fact of the $3.39 billion of cash on hand as of Sept 30, 2016, $2.5 billion (71% of cash on hand) came from the Government of Quebec, soon another $1.0 billion will most likely come from Ottawa (PM is from Quebec, and they always “help” Bombardier), and then Quebec and Ottawa will be 66.7% owners of the CSeries program (CSALP – CSeries Aircraft Limited Partnership, a separate company, spun off from Bombardier ??). How did we the Canadian taxpayers become “owners” again of a commercial aircraft program that NO commercial aircraft OEM wanted in 2015 when it was for sale for “a song” ? Especially after we the Canadian taxpayers “SOLD” Bombardier, our government owned Canadair in 1986 (for $120 million) and government owned de Havilland in 1992 (for $100 million) with the rights to the Challenger business jet, later stretched into the CRJ line, and the DHC-8 turboprop airliner later stretched into the DHC-8-Q400 line. Meanwhile, Embraer is going to the WTO again to complain about Bombardier’s “illegal state aid”, while Boeing may go to President-elect Donald Trump and get import tariffs applied on the CSeries and then ? Oh, it is going to be an interesting 2017 for sure, stay tuned to the never ending Bombardier/Quebec/Ottawa “gong show”, as they find new ways to screw Canadian taxpayers to keep Bombardier alive at any cost.

Bombardier has now delivered its first CS100 to Swiss and CS300 to airBaltic and talks confidently of a turnaround next year and a bright future in 2020 as per its 5 year Transformation Plan, that should see company become a $US 25 billion a year company by the end of 2020, with Aerospace to provide … Continue reading

SUMMARY: Bombardier 1st Half results are out, and it is not good for Aerospace. With only 318 firm CSeries orders today and up to 95 “questionable”, the program suffers from poor sales but even worst, negative margins due to deals below cost, this cannot continue for very long. Yes, 2016 is a tough year for aircraft orders at Airbus and Boeing, and a “price war” is on ! and any big deal will require +65% off list price, which means every new order brings more loses for Bombardier. Meanwhile, CRJ line has only 66 orders in backlog (9 x CRJ-700, 36 x CRJ-900 and 21 x CRJ-1000) good for 25 months of production at the current 2.7 aircraft per month rate, while the Q400 is down to 48 in backlog (40 + 8 recent orders), good to May, 2018 at the current 2.3 aircraft per month. Big discounting under way on the Q400 and CRJ is evident in financials to boost sales, while Business Aircraft orders are slowing down, and production already 20% below last year will be reduced again soon to balance supply and demand. Nothing very promising at Bombardier Aerospace, the company struggles and the 5 year Transformation to 2020 does not look promising at all, market dynamics are creating havoc for Bombardier, but all of that had to have been anticipated when they decided to enter the BIG league and take on Airbus and Boeing, maybe not such a great idea after all ?

LOTS OF ARTICLES IN AVIATION DOCTOR ON BOMBARDIER, TAKE A LOOK. Bombardier (TSX:BBD.B) has released its 1st Half 2016 financials and its time to analyze what is going on at Bombardier so far this year in regard to its struggling Commercial and Business aircraft business. The first 6 months of this year, has seen Bombardier’s … Continue reading

MAYDAY ! As if the situation was not bad enough at Bombardier following the Paris Air Show, where NO new orders for any of it’s 3 commercial aircraft were announced, and this week, it’s stock (TSX:BBD.B) hit a 22 year low at $C1.90 per share, down 49.3% in the past 12 months, and down 61.3% in the past 5 years ! another 49% drop and its a “penny stock” (<$C1.00). Meanwhile market capitalization of the company is now at an extremely low $C 4.3 billion for a company with $US 20+ billion in revenue. The latest bad news was that there is a "review" and a 18+ month delay in the new Global G7000/G8000 business jet programs. The Global brand is Bombardier's "cash cow", it is the light at the end of the tunnel today, as it provides the best margins, 60% of business jet revenue, 43% of Bombardier aerospace revenue with just 27% of total aircraft deliveries, trouble there means bigger troubles for the whole company, especially now. The ultra-long range business jet segment is weakening all over the world, new competitors are coming in like the new Gulfstream G500/G600's and Dassault's 8X and 5X, while the current Global G5000/G6000's badly need a "revamp" (e.g. Challenger 300 to 350 and 605 to 650), but everything is on the back burner these days because of the CSeries, a program that has changed the company for the worst, and a program that may yet destroy the company directly or indirectly in the end. Yet they want to stretch it into a 160 seater (CS500) and go toe to toe with Airbus and Boeing in the largest and most contested and price discounted aviation market segment today, the single aisle narrow-body, which will be joined by the Comac C919 and Irkut MC-21 in the next 5 years ? oh boy !

I thought things could not get worst for Bombardier after the Paris Air Show last month, but they have, as investors have seen the share price (TSX:BBD.B) hit a 22 year low last week of $C 1.84 and as of yesterday it closed at $C 1.90 per share as investors sell and lose confidence in … Continue reading

ABSTRACT: Bombardier takes another credibility hit, stock drops 25% in one day as investor confidence is shaken and they are selling, another senior executive departs, the Learjet 85 is “paused” with a $US 1.4 billion write down, certifying 4 new jets at once costing $US 6.9 billion was “nuts”, the Q400 and CRJ’s programs are near their end, another 1,000 employees are to be laid off on top of 2,000 last year, corporate credit rating cut, talk of a Q400 and CRJ assembly line in China, only 243 firm orders for the CSeries after 78 months of effort, and probably 100+ will NOT take delivery, Alenia a major CSeries subcontractor sues for $US 121 million, CSeries EIS not till 2016, low fuel prices diminish the fuel efficiency argument for CSeries, while it’s launch customer is a secret ? sell Commercial Aircraft Division to China’s COMAC and create Combardier ? capital markets worried about liquidity and management, Business Aircraft Division now discounting some aircraft, Learjet cannot survive on only 33 Learjet 70/75 sales (+/- $US 335 million) a year, is it doomed ? sell it off ? with a cashflow of only $US 800 million in 2014 will Aerospace have the cash to complete certification and produce the $US 1 billion Global 7000/8000 business jets and the $US 4.5 billion CSeries ? time for an outsider as CEO – again ?

Bombardier, the world’s only plane and train manufacturer continues to disappoint shareholders, employees and customers, and on Wednesday, January 15th, we saw the wall crash down, when Bombardier stock (TSX:BBD.B) crashed downwards by 25.85% in one day ($US 1.8 billion in market capitalization) on volume of 57 million shares, to $CAD 3.07 from $CAD 4.14, ouch … Continue reading