The Montreal-based company announced on Wednesday that it plans to eliminate 7,000 positions over two years, including 2,830 in Canada, after losing US$5.34 billion in 2015.
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Bombardier announced Wednesday that it will cut its workforce by 7,000 positions over two years, which includes 2,000 contractors.
Occupation losses will likely be partly offset by hiring for the creation of its CSeries jets that were commercial, it said.
The company said it posted revenues of $18.2 billion last year, a 9.6 percent drop from the year before.
Alain Bellemare, president and chief executive officer, said: “We are turning Bombardier around to make this great company stronger and more competitive”.
Air Canada has entered into a Letter of Intent to acquire up to 75 Bombardier CS300 aircraft.
Bombardier, which has about 64,000 employees, expects to record $250 million to $300 million in restructuring charges in 2016 for the layoffs.
Mick Cash, RMT general secretary, said: “With a desperate shortage of rail rolling stock in Britain it is criminal that jobs are being axed at the UK’s last train building workshop, Bombardier in Derby”.
The best thing for the company, he said, would be to abandon the commercial airline market at the end of the C Series’ life to focus on corporate jets and turboprop short-haul planes, and perhaps seek a partner in an emerging economy such as Russian Federation or Brazil despite the possible political controversy. “We are pleased to contribute to Air Canada’s continued success”.
“The C series will be a key element of our ongoing fleet renewal, which will result in Air Canada operating one of the world’s youngest and most fuel efficient airline fleets”.
“Despite the non-firm agreement, we believe this order could represent a strong commitment for the long-term viability of the C Series“, Desjardins analyst Benoit Poirier said in a note to clients.
Bombardier’s results for the quarter missed expectations and it forecasted revenue that was lower than expectations for 2016. The company asked Ottawa for financial assistance past year.
The problem is Bombardier’s C-series of airplanes, which have experienced manufacturing increases.
The federal Liberals say they are studying Bombardier’s request for more funding, which reports say is also $1 billion. It plans a special shareholder meeting to get approval for a reverse stock split that would aim to exchange outstanding shares for a smaller number of consolidated shares, with a price in the range of C$10 to $20 each.
Revenue fell 16% to $5.02 billion, below the $5.48 billion analysts expected.
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Bombardier ended the fourth quarter with a loss of $677 million, or 31 cents a share, compared with a year-earlier loss of $1.59 billion, or 92 cents.
