The order from Delta Air Lines, the largest yet for the new lines of planes, will be worth at least $5.6 billion (£3.8bn) based on a firm commitment to buy 75 of the aircraft.
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He said: “It is a ringing endorsement for workers in Belfast, where much of the C Series is produced, and helps sustain Bombardier’s future here”. Delta Airlines has placed a firm order for 75 CS100 aircraft with options for an addition 50 plans. Deliveries are expected to start in the spring of 2018.
“As we reshape our fleet for the future, the innovative onboard experience of the C Series is a flawless complement for the top-notch service provided every day by Delta people”, incoming Delta chief executive Ed Bastian said.
“We believe the unique, patented process we’ve developed represents a step-change in aircraft wing technology, and is strengthening the UK’s strategic goal of being the world leader in aircraft wing design and manufacture”.
The order is a “major boost for this program and provides runway to allow the C Series to gain some traction in the marketplace”, Peter Arment, an analyst at Sterne Agee CRT in NY, said in a note to clients.
There is jubilation in the offices of Bombardier right now by reason of a huge order made by Delta Airlines for its new C series jets.
But a new leadership team installed since a year ago has signaled more flexibility as it searched for two deals with “marquee” airlines, represented now by Air Canada and Delta.
“This is potentially a tipping point to make the C Series a long-running success story, after a very hard early childhood”.
The CSeries deal is a setback to Boeing which had planned to sell Delta 20 used Embraer jets traded in by Air Canada as part of an earlier order.
Securing the order does not appear to have come cheap for Bombardier, which is waiting for a decision on its request for $1 billion in Canadian government aid.
Analysts including Deutsche Bank’s Richard Phelan hope Ottawa will also pony up funds to shore up Bombardier’s balance sheet and “serve as an additional catalyst to keep up the momentum”.
Carriers typically negotiate very large discounts on jet purchases, especially for early launch orders like this one. Bombardier Chief Financial Officer John Di Bert said the program remains on track to break even on a free cash flow basis in 2020.
Bombardier’s net loss for the first-quarter was $138 million, compared to net income of $100 million in the same quarter a year ago.
“Our multiple voting shares allow us to invest long term and protect the dismantling of this company”, said Pierre Beaudoin, the executive chairman of the board, a response that drew cheers from the approximately 900 people gathered in a Bombardier hangar in Mirabel, Que.
Revenue for the quarter fell to US$3.14 billion compared with almost US$4.4 billion in the first three months of 2015.
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In the quarter, Bombardier’s business aircraft division delivered 31 aircraft compared to 45 in the first quarter of 2015, a 31 percent decline.
