[Admiral Beez]

And if the genius Wilbur Ross of the U.S Commerce Department even tries to foolishly place duties on Airbus, they would be launching a full scale trade war which the WTO would never allow. I wouldnt put it past him to do it however, since his boss above him is incompetent.

That'll anger the good people and governor of Alabama, where the C-Series would be built. http://governor.alabama.gov/news/press-releases/lt-governor-ivey-comments-on-airbus

Congratulations to Governor Robert Bentley on his steadfast commitment to create jobs in our state. U.S. Senators Richard Shelby and Jeff Sessions, U.S. Representative Jo Bonner and Mobile Mayor Sam Jones are to be congratulated as well.

Basically Boeing is screwed. Idiots.

 

[crs1026]

I take from this exchange that Airbus has control of the C Series design team, and can redirect to product development as it sees fit? Or will Bombardier be able to parter with Airbus on equal footing so that any future work is mutually beneficial?

I'm not so willing to bash this deal as a failure of any one aspect of political will or trade policy or public ignorance, so much as I am to bash the Canadian business mentality. Bombardier was not up to being a world class aerospace producer (by which I mean a corporation that could not only design, but market, finance, build, and outmanouever competitors in the marketplace). This fact has been known for years. The financial props, and the continued presence of the family in Bombardier's governance, should made it apparent that there were weak links. Champions don't have weak links. (Streetcars needn't enter into this picture.)

In free enterprise, a company has the right to chart its own course. But, if one is not quite good enough, there are consequences.

It's a bit like sports. Real fans don't start talking Stanley Cup when a single line starts scoring. It's not disloyal for fans to point out their team's weak links, nor is it a Canadian inferiority complex to bash Bombardier's weak links.

Bombardier just wasn't good enough. The investment community, the Canadian media, the investors, the government, all are guilty of stepping around this elephant in the room. Canadian companies that want to capture world championships can't just aspire, they have to eliminate weak links. Nobody insisted on this. Canada needs to learn a lesson about being hard on ourselves.

- Paul

 

[kEiThZ]

People love to slam the family. But want to know why the feds and Quebec prop them up? Because there's no real reason for BBD to stay in Canada. That's the truth. They would benefit a lot more from moving to the US and building more of their airplanes in China. That family's control is a huge part of why BBD is still Canadian.

I will agree that the family have terrible management instincts though. But this deal does reflect on Canada quite a bit. Add BBD to RIM, NORTEL, our auto sector, etc. Proof that Canada is just not the place to scale your business.

Sure, Bombardier made some mistakes in the development of the CSeries. They are nowhere close to what Airbus did on the A380 or the $27 billion in losses that Boeing has racked up on 787 sales to date. Yet, the Americans picked on us because we were small. And it worked.

The only question today is why the Chinese didn't bid. Bombardier's expertise with COMAC's cost base would have made for a solid third player in the airliner business. And China doesn't give a damn about American trade complaints. They would have simply locked Boeing 737s out of the Chinese market if Boeing got uppity.

 

[rbt]

I take from this exchange that Airbus has control of the C Series design team, and can redirect to product development as it sees fit? Or will Bombardier be able to parter with Airbus on equal footing so that any future work is mutually beneficial?

Airbus has majority control (pending regulatory approval) with intent to purchase 100% of the program by 2023. They can do whatever they like with it. Boeing has already announced they're talking with US authorities about blocking the sale. AFAIK BBD will manufacture existing orders (except Delta) and then wind down operations.

Their announcement about looking for someone to pickup the Q400 program means they're getting out of general aviation entirely which is the piece I had the most interest in.

 

[AlvinofDiaspar]

The only question today is why the Chinese didn't bid. Bombardier's expertise with COMAC's cost base would have made for a solid third player in the airliner business. And China doesn't give a damn about American trade complaints. They would have simply locked Boeing 737s out of the Chinese market if Boeing got uppity.

Maybe the stole everything?

AoD

 

[Admiral Beez]

Bombardier was not up to being a world class aerospace producer (by which I mean a corporation that could not only design, but market, finance, build, and outmanouever competitors in the marketplace).

To be fair, neither was BAE or other European airliner producers, as they like Bombardier have paired up with Airbus.

 

[TOareaFan]

Their announcement about looking for someone to pickup the Q400 program means they're getting out of general aviation entirely which is the piece I had the most interest in.

When did they “announce” that?

I saw some media reports saying the aerospace division was under review.....and in those some uncredited comments that sale of prop and CRJ was likely to allow focus on C series......but I did not see any BBD comment on those stories or any announcement.

It could be that I missed it in all the other news.....it could be that it hasn’t happened yet but might or it could even be that people who knew about the aerospace review got it wrong and prop and CRJ is what they hang on to long term?

 

[rbt]

When did they “announce” that?

I read it a few days ago. Perhaps it was an alternative option.

Either way, they've got old designs in need of significant investment and are rapidly losing market share to ATR.

 

[kEiThZ]

Airbus has majority control (pending regulatory approval) with intent to purchase 100% of the program by 2023. They can do whatever they like with it. Boeing has already announced they're talking with US authorities about blocking the sale. AFAIK BBD will manufacture existing orders (except Delta) and then wind down operations.

Their announcement about looking for someone to pickup the Q400 program means they're getting out of general aviation entirely which is the piece I had the most interest in.

Boeing's complaints are laughable. They have no way to block the sale. It's a sale of a program between a Canadian and a European company. It's not the sale of the firm. So there's no anti-trust considerations. No matter how much they cry. And it's going to awfully hard to keep insisting on tariffs for airplanes that have a higher US content than the 787. They know they got played. It's all PR at this point.

BDD isn't exiting general aviation. They are exiting Commercial Aviation. They'll go back to making bizjets. Remains to be seen if they'll stick with their regional jets and turboprops. Those are getting long in the tooth and also need investment. All while Bombardier still has to pay $700 million over the next 3-5 years.

Maybe the stole everything?

In some domains yes. But it's kinda hard to do in the aerospace sector. Bombardier makes the CSeries fuselage in Shenzhen. And that's actually one of their problem areas. The Chinese aren't great on quality. And that's a must with aerospace. Bombardier was able to deliver 99% reliability at launch. Unheard of from anybody else. That can't happen with the Chinese. But that's where Bombardier could have really offered them something. Along with a large global sales network, customer relations with Western airlines, etc. That would have been a much more equal partnership than Airbus basically swallowing the CSeries for a pittance.

 

[rbt]

BDD isn't exiting general aviation. They are exiting Commercial Aviation.

Sorry, yes, I misspoke. That's what I meant.

 

[Admiral Beez]

Boeing's complaints are laughable. And it's going to awfully hard to keep insisting on tariffs for airplanes that have a higher US content than the 787.

They insisted on tariffs on airplanes in a category they don't even play in, so it's not unlikely they'll follow a similarily illogical path to justify continued tarrifs against the parts or components imported to the assembly plant in Alabama. I'd love to see the governor of Alabama declare their support of Airbus' new production for Delta, and tell Boeing to shove off.

BDD isn't exiting general aviation. They'll go back to making bizjets. Remains to be seen if they'll stick with their regional jets and turboprops. Those are getting long in the tooth and also need investment.

AIUI, their biz jets are the wrong size, the market wants 737-sized (or C-Series!) sized biz jets, rather than BBR's Global Express or Learjets, but I can't find where I read that, so might be offside.

As for the Dash 8 (Q400), I fear for the jobs and plant at Downsview, since that business is not getting any investment, and will likely be sold off. The Downsview plant and runway rights alone could be worth hundreds of millions in real estate sales. Could Viking Air make a go at the Q400? They already make the DHC-6 Twin Otter.

 

[crs1026]

People love to slam the family. But want to know why the feds and Quebec prop them up? Because there's no real reason for BBD to stay in Canada. That's the truth. They would benefit a lot more from moving to the US and building more of their airplanes in China. That family's control is a huge part of why BBD is still Canadian.

I will agree that the family have terrible management instincts though. But this deal does reflect on Canada quite a bit. Add BBD to RIM, NORTEL, our auto sector, etc. Proof that Canada is just not the place to scale your business.
.

Hey, who showed you my stock portfolio ? ;-)

Can't argue with your point re scaling. But - I can't think of anything in Canada's fiscal or trade policy that makes this so. It's more of a lack of competency/wisdom deficit - along with a national tendency to get a swelled head too soon when something begins to succeed, and nobody thinks about the hard steps that it will take to go from serious contender to champion. Call it the Blue Jays/Maple Leafs syndrome. And I as a very small investor am typical of our investment community by letting my Canadian pride get in the way of the hard questions that I ought to have asked before buying NT, BBD, etc.

My beef with the family is not that they have been either clever or stupid. It's the fact that the company reached a fork in the road where, had it been any other business, the stakeholders would have demanded a non-negotiable change in control before providing money. Countries do what they have to do in order to save an enterprise, but there should have been a harder bargain driven, if only to reinforce that we were spitting in the wind of common sense. Just as contending teams have to be reamed out when they go into a slump for a few games, even if they are truly talented and there is ample reason to believe they will come out of it in time.

- Paul

 

[Cobra]

My analysis is that the Trump administration methods worked as there will be new manufacturing jobs in the US thanks to Airbus using the Alabama plant to assemble the C Series. But it also shows that this administration doesn`t care that it just threw Boeing under the bus for opportunities at scoring future political points.

The biggest loser is Boeing who will face stiff competition from Airbus+Bombardier with superior jets with the potential of using C Series technology into Airbus bigger jet.

Karma's a b***

 

[Admiral Beez]

The biggest loser is Boeing who will face stiff competition from Airbus+Bombardier with superior jets with the potential of using C Series technology into Airbus bigger jet.

Instead of fighting with tarrifs, Boeing should fight Airbus-BBR with a 100 seat aircraft of their own. There should be no reason Boeing can't turn around such an aircraft quickly enough to make a difference.

 

[TOareaFan]

Instead of fighting with tarrifs, Boeing should fight Airbus-BBR with a 100 seat aircraft of their own. There should be no reason Boeing can't turn around such an aircraft quickly enough to make a difference.

Heck, they could build something called the 717......last I checked there were still a few airlines flying those around.....only one airline with more than 2 dozen of them though.....Delta! Funny that when your largest customer for your plane in the ~100 seat category is disappointed that you no longer serve that market and they turn to the most modern airline in that segment and your only response is to cry to the government