Canadian manufacturer Bombardier announced Thursday its first new order for its CSeries jetliners in more than a year and since partnering with Europe's Airbus last month. An unnamed European customer has signed a letter of intent to buy 31 of the passenger aircraft for US$2.4 billion, and an option for 30 more, Bombardier said in its quarterly earnings report.
Company president Alain Bellemare said the sale reflects "increasing confidence customers have in the CSeries." "Looking forward, as Airbus joins the program, and with the CSeries continuing to prove itself in service, we expect sales momentum to accelerate quickly," he added.
The CSeries made its entry into market space dominated by Airbus and Boeing with its first deliveries in 2016 - late and over budget. It was the first new design in the 100- to 150-seat category in more than 25 years. But US rival Boeing has filed a trade complaint accusing Bombardier of having unfairly benefitted from state subsidies that allowed it to sell the aircraft at below cost to Delta Air Lines in the United States. And this led to the US Commerce Department imposing huge countervailing and anti-dumping duties on the CSeries.
Bombardier responded by handing a majority stake to Airbus and moving part of its CSeries production to an Airbus facility in Mobile, Alabama. The deal with Boeing archrival Airbus was seen as a way to get around the trade dispute. As part of the deal, Airbus also agreed to use its significant marketing heft to promote the CSeries to potential buyers around the world.
The latest order increases total sales of the CSeries, which cost Can$5.4 billion to develop, to 391 aircraft. Bombardier's losses, however, continued to rise in the third quarter to US$117 million, up from US$94 million in the same period last year, despite increased revenue. Excluding one-time exceptional costs, the loss narrowed to one cent per share, in line with analyst forecasts.
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