Guest Posted June 25, 2019 Share Posted June 25, 2019 Bombardier sells regional jet business to Mitsubishi Bombardier selling CRJ program to Mitsubishi for US$550M Japan's Mitsubishi Heavy Industries is buying Bombardier's Canadair Regional Jet program for US$500 million cash, with the assumption of about US$200 million in debt, the companies announced Tuesday. Patrick Horan, principal at Agilith Capital, joins Paul Bagnell to discuss. The Canadian PressPublished Tuesday, June 25, 2019 8:29AM EDT Last Updated Tuesday, June 25, 2019 8:48AM EDT MONTREAL -- Bombardier Inc. announced Tuesday a deal to sell its regional jet program to Mitsubishi Heavy Industries Ltd. for US$550 million. Bombardier chief executive Alain Bellemare said the agreement represents the completion of the transformation of the company's aerospace business. "With our aerospace transformation now behind us, we have a clear path forward and a powerful vision for the future," Bellemare said in a statement. Related Links Bombardier statement - Mitsubishi Heavy Industries to Acquire Canadair Regional Jet Program "Our focus is on two strong growth pillars: Bombardier Transportation, our global rail business, and Bombardier Aviation, a world-class business jet franchise with market-defining products and an unmatched customer experience." Mitsubishi, which will also assume liabilities totalling about US$200 million, will acquire the maintenance, support, refurbishment, marketing and sales activities for the CRJ Series aircraft. The agreement includes the related services and support network located in Montreal and Toronto and its service centres in Bridgeport, W.Va., and Tucson, Ariz. Mitsubishi chief executive Seiji Izumisawa said the deal is an important step towards building a strong, global aviation capability. "In combination with our existing infrastructure and resources in Japan, Canada and elsewhere, we are confident that this represents one effective strategy that will contribute to the future success of the Mitsubishi SpaceJet family," Izumisawa said. The CRJ production facility in Mirabel, Que., will remain with Bombardier, which will also continue to supply components and spare parts. Bombardier will assemble the current CRJ backlog on behalf of Mitsubishi with production expected to be completed in the second half of 2020. Bombardier will also retain roughly US$400 in liabilities representing a portion of the credit and residual value guarantees. The deal is expected to close in the first half of next year, subject to regulatory approvals and customary closing conditions. https://canadianaviationnews.wordpress.com/feed/ Link to comment Share on other sites More sharing options...
rudder Posted June 25, 2019 Share Posted June 25, 2019 I am curious what the end game plan is here for Mitsubishi? I suspect they now have the right to dismantle the CRJ program and thereby narrow the regional jet options for prospective customers thereby potentially increasing the demand for their own RJ product. Link to comment Share on other sites More sharing options...
JL Posted June 25, 2019 Share Posted June 25, 2019 Time for probably a more emotional than rationale comment, but how many 0.1 percenters in Canada have made out incredibly well on Canadian tax payer dollars over the last 30 years propping up this poorly managed company. Somebody please correct my perception to alleviate my frustration. Link to comment Share on other sites More sharing options...
Guest Posted June 26, 2019 Share Posted June 26, 2019 2 hours ago, JL said: Time for probably a more emotional than rationale comment, but how many 0.1 percenters in Canada have made out incredibly well on Canadian tax payer dollars over the last 30 years propping up this poorly managed company. Somebody please correct my perception to alleviate my frustration. Based on the pay rates a lot of well paid highly skilled workers did quite well as of course I guess did the Bombardier family.. Link to comment Share on other sites More sharing options...
Super 80 Posted June 26, 2019 Share Posted June 26, 2019 3 hours ago, JL said: Time for probably a more emotional than rationale comment, but how many 0.1 percenters in Canada have made out incredibly well on Canadian tax payer dollars over the last 30 years propping up this poorly managed company. Somebody please correct my perception to alleviate my frustration. I honestly think that when we look at where Airbus is in Canada a decade from now every penny dumped into Bombardier and predecessors will look like money well spent. Link to comment Share on other sites More sharing options...
boestar Posted June 26, 2019 Share Posted June 26, 2019 Mitsubishi RJ product is stalled at best. There are no orders for it. The CRJ program will instantly give them a product that is marketable as well as the growth product they needed in the CRJ 1000 Link to comment Share on other sites More sharing options...
rudder Posted June 26, 2019 Share Posted June 26, 2019 2 hours ago, boestar said: Mitsubishi RJ product is stalled at best. There are no orders for it. The CRJ program will instantly give them a product that is marketable as well as the growth product they needed in the CRJ 1000 According to the announcement and the related news stories today, the CRJ Program is terminated. Back orders will be built in to 2020 but after that CRJ production will be halted. Manufacturing facilities overseas to be sold. The sale of the business by BBD represents the end of the CRJ Program other than customer support. Meanwhile, Mitsubishi is working on its own 76 seat variant to meet US scope provisions. https://leehamnews.com/2019/06/13/how-mitsubishi-aircraft-morphed-the-mrj70-into-the-m100-spacejet/ Link to comment Share on other sites More sharing options...
conehead Posted June 26, 2019 Share Posted June 26, 2019 How will this affect the facility in Belfast, that used to be Shorts? Or did they become part of Airbus with the C-series deal? Link to comment Share on other sites More sharing options...
J.O. Posted June 27, 2019 Share Posted June 27, 2019 18 hours ago, conehead said: How will this affect the facility in Belfast, that used to be Shorts? Or did they become part of Airbus with the C-series deal? That aspect is still to be determined. Apparently Airbus is "looking at it". Link to comment Share on other sites More sharing options...
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