Bombardier received the final go-ahead to start delivering its C Series jet to customers after the aerospace and train-building company was granted an airworthiness certificate. The certification from Canada’s transport regulator was a rare piece of good news for a development project that has cost $5.4bn, run years late and garnered far fewer orders than projected. The decision clears the way for the aircraft to enter service with Lufthansa’s Swiss subsidiary some time in the second quarter of 2016. Qébec’s provincial government in October committed to investing $1bn in a joint venture with Bombardier that will produce the C Series. Québec’s public employees’ pension fund in November provided a further cash injection for the company when it bought a 30 per cent stake in its train-building business for $1.5bn.
Marc Garneau, Canada’s transport minister, said confirmation of the aircraft’s certification sent a “strong signal” to investors and potential customers. “The message is that Canadian aerospace products have a well-deserved reputation for value and reliability and the C Series is now part of that.” However, the pressing question for the project remains whether Bombardier — whose net debt stood at $6.8bn at the end of September — can finance the investments necessary to produce the aircraft in large numbers. Richard Aboulafia, an analyst with the Virginia-based Teal Group, said Bombardier’s access to cash remained a big issue. “The only lack of clarity here is whether Bombardier has the wherewithal, whether they can do the production ramp-up and gear up to support the product,” Mr Aboulafia said.
Bombardier’s B shares closed up more than 16 per cent at C$1.36 in Toronto. Much of the rise came after Reuters reported that Pierre Beaudoin, the company’s former chief executive and a member of the controlling Bombardier-Beaudoin family, would resign as executive chairman. Bombardier denied the report. The certification was for the smaller CS100 variant of the aircraft, which can seat up to 110 people. Certification for the larger CS300, seating up to 135, is expected in 2016. The C Series was intended to fill a perceived market gap between the regional jets of which Bombardier is a significant supplier and the narrow-body A320 and 737 commercial jets manufactured by Airbus and Boeing. Bombardier has long set itself a target of securing 300 firm orders for the C Series by the time the aircraft enters service. However, Bombardier has taken no new firm orders beyond the existing 243 for several years.