Newspaper article The Canadian Press

Bombardier Expected to Double Down on CSeries Sales Drive in China

Newspaper article The Canadian Press

Bombardier Expected to Double Down on CSeries Sales Drive in China

Article excerpt

Bombardier CSeries hit may not be lethal


MONTREAL - Bombardier Inc. is expected to double down on its efforts to snag a CSeries order from China after the U.S. announced hefty duties that threaten to shut it out of the large American market.

"The CSeries business is probably not viable longer term without access to the U.S. market, but Bombardier may be able to find enough international customers to still ramp up production in the next few years," says analyst Cameron Doerksen of National Bank Financial.

He said uncertainty over the overbudget aircraft remains the biggest investor concern, but anxiety can be alleviated by a new order from a large airline outside the U.S.

Bombardier's (TSX:BBD.B) shares lost more than seven per cent to close at $2.10 Wednesday on the Toronto Stock Exchange as investors weighed the prospect of a 220 per cent duty on U.S. sales of its flagship CSeries passenger jets and the European merger of two railway rivals.

Analysts say the U.S. Department of Commerce's preliminary duty decision, which was much harsher than expected, raises questions about the future of a key order for up to 125 CS100 jets by Delta Air Lines.

The department ruled in favour of Boeing, which alleged that Bombardier used unfair government subsidies to sell aircraft at artificially low prices. U.S.-based Delta Air Lines has argued that Boeing doesn't even make the 100-seat planes it needs.

Bombardier's last CSeries order for two aircraft came in December but the company has suggested it was confident of signing new deals by year-end.

The Montreal-based company has been targeting buyers in Europe, Asia, Africa and the Middle East. A published report suggested talks with Chinese airlines could lead to a deal that could be announced when Prime Minister Justin Trudeau is on a state visit to the country.

Bombardier didn't respond to requests for comment about the viability of the CSeries but late Tuesday called the size of the proposed duty "absurd. …

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