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Bombardier Posts Mixed 2020 Results, Announces Learjet Retirement
Bombardier continued its quest for stabilization following a difficult 2020, announcing numerous changes across the company as it seeks to achieve profitability. The most recent casualty will be the Wichita-based Learjet, which will cease production in the fourth quarter of 2021.
Asset Disposals Generated Much-Needed Cash
Bombardier’s recent asset disposals have generated significant cash on hand, growing by $3.6 billion following the sale of Bombardier Transportation to Alstom, of which the Canadian manufacturer turned over its personnel and facilities to the French multinational railway builder. Alstom finalized the infusion of Bombardier Transportation on January 29th when all Bombardier employees officially transitioned to their new owner.
In addition to the sale of Bombardier Transportation, Bombardier also parted ways with its CRJ program this past financial year. The CRJ program was transitioned to Mitsubishi Heavy Industries in July 2020 as the Canadian company finalized its decision to disband its commercial aircraft production lines.
Pure-Play, Business Jet Company
Other notable announcements from the 2020 Financial Report include the business aviation segment producing $5.6 billion in revenue, following a record for deliveries in a quarter with 16 Global 7500 deliveries in the fourth quarter in 2020. In total, Bombardier Business Aircraft delivered 59 Global aircraft, 44 Challenger aircraft and 11 Learjet aircraft in the 2020 financial year.
The recent turn of events brought positivity out of President and CEO Éric Martel, saying, “With our strategic repositioning now complete, we are very excited to embark on our journey as a pure-play business jet company. Our unmatched product portfolio, world-class customer services network, and incredibly talented employees give us a strong foundation to build upon. We are encouraged by our momentum in the fourth quarter and are confident in the actions we are taking to navigate through the pandemic and better position the Company for a market recovery.”
Despite the improving financial results, Bombardier sees more trimming necessary to survive as 1,600 positions and the Learjet brand will be axed in 2021. These positions extend to both the United States and Canada, with 700 Quebec and 100 Ontario-based jobs expected to be eliminated alongside the 250 Learjet-tied manufacturing positions in Wichita, Kansas.
Conclusion of Learjet
For Learjet, the slow decline of the aircraft brand has seen the once staple of quick, luxurious private jet travel transition to other brands like Challenger and the Cessna Citation. The Learjet brand was formed by William “Bill” Lear in 1963 and peaked with the Learjet 23, 24 and 25 in the 1960s through 1980s. Recent production has not been as promising for the jet, with the 2013 Learjet 75 only netting 156 deliveries to date and the composite made Learjet 85 failing to receive financial backing to clear certification.
Martel noted the conclusion of Learjet by saying, “With more than 3,000 aircraft delivered since its entry-into-service in 1963, the iconic Learjet aircraft has had a remarkable and lasting impact on business aviation. Passengers all over the world love to fly this exceptional aircraft and count on its unmatched performance and reliability.”
As for the future of the Learjet facilities, Bombardier announced the RACER program to allow for avionics, interior improvements, structural repairs and engine enhancements for existing Learjet 40 and 45 aircraft. Wichita’s Centre of Excellence and flight testing centers are expected to remain active in supporting other Bombardier products.
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