Bombardier secures major Delta Airlines deal for C Series jets
Canadian aerospace giant Bombardier has secured a game-changing Delta Airlines deal for its C Series jets.
Montreal-based Bombardier, which employs around 5,000 people in Belfast, have also revealed their financial results for the first three months of 2016 this morning.
Based on the list price of the CS100 aircraft, the firm order is valued at approximately $5.6 billion US.
“As we reshape our fleet for the future, the innovative onboard experience of the C Series is a perfect complement for the top-notch service provided every day by Delta people,” said Ed Bastian, Delta’s incoming chief executive.
“These new aircraft are a solid investment, allowing us to take advantage of superior operating economics, network flexibility and best-in-class fuel performance.”
“Welcoming Delta Air Lines to the C Series family of operators is a watershed moment for our game-changing aircraft. As an industry leader, Delta consistently ranks first with customers, business leaders and its peers - a benchmark for operational performance,” said Fred Cromer, President, Bombardier Commercial Aircraft. “This order is a resounding endorsement of the CS100 aircraft performance and its exceptionally low operating costs. In addition, its widest aisle, widest seats and largest bins in its class will be attractive features for Delta’s passengers.”
The production of wings for the C Series is Northern Ireland's biggest-ever inward investment programme, worth £520m.
A shareholders' meeting will also take place in Montreal tomorrow.
The news of the major order was welcomed by Ulster Unionist Party leader Mike Nesbitt.
Mr Nesbitt said: "This will come as a major relief, not just to Bombardier employees, but also to anyone who fears for the future of manufacturing in Northern Ireland. The company is important in its own right. Its presence also makes a statement internationally about Northern Ireland and our economy. It is imperative we continue to host a global player like Bombardier.
“Now we need to press on with the challenge of improving the business environment to make Northern Ireland more attractive as a place to do business.
"In that regard, I commend my colleague Danny Kinahan MP for persuading the Northern Ireland Affairs Committee at Westminster to instigate an inquiry into energy costs in Northern Ireland, because our high tariffs pose a serious threat to the future of our manufacturing sector."
Union hopes order will mean planned redundancies can be avoided
Davy Thompson, Unite Regional Coordinating Officer responsible for Bombardier-Shorts workforce, expressed his union’s hopes the order from Delta could mean a downward revision of plans for redundancies.
Mr Thompson said: "The last few months have been very challenging for the workforce with a series of lay-off announcements affecting both agency and core workforces, as well as unprecedented changes to the company’s longstanding apprentice employment scheme.
"While the company’s difficulties are not exclusively caused by the overrun in development costs and delay in orders for the CSeries, the scale of this project is so great that the company’s future is dependent on its success in securing large-scale orders.
"We hope that today’s good news will be followed up by further orders from other airlines. The CSeries has a huge advantage in terms of fuel efficiency and this contract offers encouragement that other airlines will follow suit.
"While we are hopeful this order – worth $5.6 billion for seventy-five planes and including the option for a further fifty – may allow management to reconsider plans to lay-off a further five hundred workers in Belfast in 2017; we recognise that the company continues to face very challenging conditions due to the depressed private and regional aircraft market and that CSeries represents only a small proportion of the work conducted in Belfast.
"Unite will continue to engage constructively with management to secure our members’ jobs, pay and conditions”, Mr Thompson concluded.
The company has so far received a disappointing level of orders for the narrow-bodied passenger jet, developed in a daring bid to take on market giants Airbus and Boeing.
It's had just 243 orders and hasn't had a firm order since September 2014.
The C Series was launched earlier this year, around $2bn over budget and delayed by three years - and a deal with a major airline like Delta was crucial to its viability.
And it comes as a much needed boost to morale for Bombardier's Belfast workforce. In February, the company announced 1,000 job losses this year and next.
Delta is currently shopping around for 125 narrow-bodied jets - therefore securing an order of that size is a major lift to Bombardier and its Belfast workforce. Sources earlier this month suggested the deal would consist of a firm order on 75 planes and options to buy another 50.
Bombardier is still waiting for the Canadian federal government to confirm if it will follow Quebec's administration in giving the company a financial bail-out.
The regional government in Quebec, where Bombardier is based, has already ploughed $1bn into the C Series programme in return for a 49.5% equity share.