Bombardier explores options for aerospace assets

FRANKFURT: Bombardier Inc is seeking investors for its aerospace businesses and considering a sale of some operations, people familiar with the matter said, as a turnaround plan at the Canadian planemaker faces pressure from potentially crippling US tariffs on its marquee jetliner.

The Montreal-based manufacturer is studying the disposal of assets including its Q400 turboprop and CRJ regional-jet unit, said the people, who asked not to be identified because the discussions are private.

Airbus SE is among the suitors, they said, with one person saying Bombardier is also open to partnerships with other aerospace companies.

Asset sales or investment deals in aerospace would raise money for Bombardier as it contends with newly imposed import duties of 300% on its C Series jetliner in the US, the world’s biggest aviation market.

Bombardier also missed out on a merger of its rail-equipment business with Siemens AG’s operation after months of talks. Deals on the Q400 or CRJ may add life to languishing products, an analyst said.

“Bombardier has neglected these products for so long,” said Richard Aboulafia, an aerospace consultant at Teal Group who added that the Q400 may have an easier time finding a buyer than the CRJ line. “These should be worth more and should be more desirable.”

The Q400 competes with planes made by ATR, which is owned by Airbus and Leonardo SpA. Bombardier’s regional jets go head to head with aircraft built by Brazil’s Embraer SA.

Bombardier and Airbus, whose earlier talks on a potential business collaboration fizzled in 2015, declined to comment. No final decisions had been made and Bombardier deliberations with potential partners may not lead to any transactions, the people said.

Bombardier chief executive officer Alain Bellemare is trying to stop a cash drain after the C Series came to market more than two years behind schedule and about US$2bil over budget.

The delays and cost overruns prompted Bombardier to accept a US$1bil investment from Quebec in the C Series programme, plus another C$372.5mil (US$300mil) from Canada. The company’s Global 7000 business jet has also been delayed.