Federal funding ‘helpful but not required,’ Bombardier Inc executive says
Bombardier Inc. is a multinational aerospace and transportation company based in Montreal, Quebec, Canada. Bombardier started as a manufacturer of snowmobiles and is now a large manufacturer of regional passenger aircraft, business aircraft, and mass transit equipment, as well as a financial services provider.
The company has grown noticeably and is that it has done so in such a way that it already has more than it needs.
Bombardier, who previously asked Ottawa for $ 1B, says those talks “are progressing well.” However, the financing that the transport company has obtained for its CSeries program is already “more than we need”.
In such a way, such financing conversations of Bombardier Inc. with the federal government are “moving forward as planned”, but the company will be fine, even if it does not receive any kind of support. This has been affirmed by the head of the CSeries program.
Financing is not mandatory since already has more than what is needed
It is necessary to establish that when considering a historically large investment in Bombardier, some argue that transparency must be a condition for any new injection of cash.
Thus, Rob Dewar, who is the vice president of aviation program CSeries Bombardier, said through a telephone interview, “We do not need a backup plan because what is already assured is actually more than we need.”
He also said, “We have obtained all the necessary funds to increase the CSeries program and also for the rest of the aerospace industry. Actually, federal funding would be an additional support for the program. … That’s really just an additional bonus that would be useful, but clearly not a requirement. “
It should be noted that Bombardier previously requested Ottawa for 1,000 million dollars, which would equal the investment made by the Quebec government in October. In return, Quebec won a 49.5 percent stake in the CSeries program, which has struggled to generate new orders amid delays and cost overruns. Similarly, Bombardier also received the U.S. $ 1.5 billion from Quebec’s pension fund, the Caisse de dépôt et placement du Québec, in exchange for a 30 percent stake in the company’s rail manufacturing business. And according to the company, the money would give him the financial cushion he needs to complete the development of the CSeries, as well as two new long-range business jets.
However, at least US $ 2 billion is needed to carry out the CS series until it starts generating positive cash flow in 2020–21. And although there was no funding for Bombardier in the federal budget on Tuesday, the vice president of aviation program CSeries de Bombardier assured that the conversations with Ottawa are “progressing well”.
Source: Kristine Owram | Financial Post