Fred Cromer

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UPDATE: Another exciting week at Bombardier, as stock surged upwards ($1.86 per share) on the news that Beijing Infrastructure (China) wants to buy Bombardier Transportation (Trains) division for $8.0 billion (valuation 60% higher than expected), which will have an IPO latter this year to provide liquidity for cash burning CSeries program. Still no new good news, and Bombardier stock (TSX:BBD.B) risks being a “penny” stock in a few weeks, as Macquarie sets target price of stock at $1.00 and recommends selling the stock now before it plunges, even though it’s AirFinance leasing division (165 aircraft, of which 94% are A320’s/B737’s) has 40 + 10 CS300 on order ? Another CSeries lessor, LCI says Bombardier needs to “start turning interest into orders from market leading airlines”, also that “two marquee customers that will each take in excess of 25 aircraft” is a must, as otherwise “LCI could abandon its 20 x CS100/300 orders”. Off course the CSeries order book lacks breath and quality (e.g. little known and struggling airBaltic of Latvia is it’s launch customer for the CS300 ?) and Bombardier needs a big new order soon to revive confidence in the program, as it is becoming clear that the current 243 orders are realistically only 150 at best while the A320neo line has 4,193 firm orders and the Boeing B737Max line has 2,869 orders, is the 100-149 seat market even viable for 2 OEM’s (Embraer and Bombardier) ? Lastly, Russian Ilyushin Finance (IFC) is talking about keeping its CSeries orders after cancelling this summer, yet EU/US/Canadian sanctions are in place (for Russia’s annexation of Crimea last year, its 4th occupation of another state’s territory since 1992) against Russian government majority owned banks, oil companies, several Putin’s close “friends/oligarchs” and current sanctions do include United Aircraft Corporation (UAC) the holding company for most of Russia’s aviation/aerospace industry, including the Sukhoi SSJ-100 SuperJet program) which also owns Ilyushin Finance (IFC), therefore any CSeries deal would be in violation of existing sanctions, and surely Canadian will stand by its obligations to STOP such a deal as NATO is facing renewed Russian aggression and a new “Cold War” is on, and no ‘western’ airline should order the Sukhoi SSJ-100 airliner as it would be a PR disaster these days one that could face a customer backlash/boycott. A Canadian election is set for next month and many Ukrainian and Eastern European citizens expect the Canadian Government to hold a ‘tough’ line on Russian expansion and aggression.

Well another exciting week at Bombardier has passed, as the stock (TSX:BBD.B) as its stock climbed to $1.37 on September 9th and then on Friday September 11th it hit $1.86, having hit a new bottom at $1.11 on August 24. ——————————————————————————————————————————————————————————————- The struggling CSeries still has only 243 ‘firm’ (53 x CS100 and 190 x … Continue reading

ABSTRACT: Bombardier Aerospace is changing its top management for the better and hopefully mediocrity within it’s ranks is on its way out at all levels, new CEO Alain Bellemare has ditched his President of Commercial Aircraft, Mike Arcamone and replaced him with Fred Cromer (ex-President of ILFC) while Swiss Global Air Lines will be the CSeries launch customer in 3Q/2016. The CSeries still has many issues ahead, flight testing schedule will change, entry into service (EIS), deep price discounting by Boeing and Airbus (40% to +50%). A major slow down in demand for business jets in China and Russia spells trouble for the Global brand, while Russia’s IFC is reviewing its order for 32 CS300’s and another 75 orders are highly questionable (in fact 44% of orders are questionable), just as more CSeries orders are badly needed, especially a BIG North American customer. Future of Learjet is up in the air, as some big changes are a must for restructuring the company, as stock price languishes below CAD$ 3.00 since February 10th and compared against it’s peers Bombardier financial performance is very poor, how long will it remain the world’s only manufacturer of trains and planes ? The good news is that there is change, and with that comes hope for everyone, new people bring new ideas, new enthusiasm and new energy, Bombardier for too long did the same things over and over again, expecting different results and off course failed to produce different results, now I see a some light at the end of the dark tunnel for Bombardier Aerospace, in the end success in business is ALL about having the right people in the right positions !

For the regular readers of my Blog, you know that I have been very critical of Bombardier Aerospace for some time, and I do take pride in the fact that I believe I was spot on for calling for BIG changes at the top. Back on January 20, 2015, I was the first to call … Continue reading