Bombardier to delay new larger airliner
The CSeries is a challenger to the Boeing-Airbus duopoly on narrow-body planes.
The new goal is for a debut by the end of next month, Montreal-based Bombardier said Wednesday. The extra time will allow for additional software upgrades "for improved system maturity and functionality," the company said.
Bombardier's move adds to the struggles of its first full-size airliner, a challenger to the Boeing-Airbus duopoly on narrow-body planes. The company set the June target in November, scrapping plans for a December flight, and Bombardier Aerospace President Guy Hachey had reaffirmed that schedule as recently as June 16 in an interview at the Paris Air Show.
"This is a bit of disappointment, given what they said even recently," Chris Murray, a PI Financial Corp. analyst, said from Toronto. Bombardier's chief challenge is now meeting its mid-2014 timetable for getting the CSeries in commercial service, he said.
That target remains in place, a Bombardier spokesman, Marc Duchesne, said Wednesday.
The CSeries will seat about 110 to 160 passengers, a step up in size from Bombardier's signature regional jets and turboprops. Bombardier, which also builds trains and business jets, is counting on new products such as the CSeries to help meet a goal of almost doubling revenue by the end of the decade.
Chief Executive Officer Pierre Beaudoin told investors at a March 21 briefing that the CSeries alone will probably contribute $5 billion to $8 billion in additional annual sales.
Airlines and lessors have been slow to embrace the plane. Bombardier has booked 177 orders so far, short of a goal of 300 by the 2014 target for entering commercial service. The CSeries won no new commitments at last week's Paris expo, the industry's biggest annual showcase for new products.
Wednesday's announcement "doesn't help confidence," Murray said. "These are challenging programs. Are further delays possible? Definitely, but at this point I've got limited expectations for production deliveries in 2014 anyway."
The CSeries will cost about 15 percent less to operate and burn about 20 percent less fuel than peers, Bombardier has said. The plane will feature composite materials and the new geared turbofan engine from United Technologies Corp.'s Pratt & Whitney.
"Many airlines are adopting a 'show me' approach prior to placing orders for the CSeries," Benoit Poirier, an analyst at Desjardins Capital Markets in Montreal, said today in a note to clients. He rates Bombardier as buy, as does Murray.
Qatar Airways CEO Akbar Al Baker said at the Paris Air Show on June 17 that he still has "interest in CSeries, but we want it to fly."
The carrier is seeking confirmation of "the outstanding performance that was promised during the time we negotiated with them," Al Baker said. "Once all this is resolved and that the aircraft is well in its flight test, we will then look into it. We are talking to Bombardier about it."
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