(Bloomberg) -- Bombardier Inc. will build two new private planes in response to growing demand for large-cabin business jets.
The Global 5500 and Global 6500 aircraft will come equipped with redesigned cabins, an optimized wing and all-new Rolls-Royce engines, Bombardier said Sunday in a statement. The models, which will have ranges of 5,700 and 6,600 nautical miles, respectively, will likely enter service at the end of 2019, the company said.
Canada’s biggest aerospace company already is working toward the service debut of its most advanced ultra-long-range business jet, the renamed Global 7500, in this year’s second half. Montreal-based Bombardier is banking on the Global 7500, which will sell for about $73 million, to contribute about $3 billion in annual revenue at the start of the next decade.
Compared with Bombardier’s existing Global 5000 and Global 6000 models, the jets unveiled Sunday offer at least 500 nautical miles of additional range, as well as a fuel-burn advantage of as much as 13 percent. The Global 5500 will be able to fly nonstop from Sao Paulo to Paris, while the 6500 can connect London to Hong Kong.
The new models “further improve” Bombardier’s competitive position in the large jet market, and should match up well against Gulfstream’s G500 and G600 aircraft, Turan Quettawala, a Scotiabank analyst in Toronto, said Monday in a note to clients.
“This announcement helps to reduce the risk around Bombardier’s 2020 business-aircraft revenue guidance as the new aircraft compare well versus the competition,” Quettawala said. Bombardier is targeting 2020 revenue of $8.5 billion in private jets, up from $4.96 billion last year.
Rolls-Royce Holdings Plc is introducing a line of business-jet engines, dubbed Pearl, that will be the sole powering systems for the new Bombardier models, the London-based manufacturer said Monday in a separate statement.
Bombardier shipped 10 of the Global 5000 and 6000 jets in the first quarter, two more than during a year earlier. It delivered 45 of the planes last year, which represents about one-third of all of the company’s business-jet shipments.
The Global 5500 will have a list price of $46 million, while the 6500 will go for $56 million, Mark Masluch, a spokesman for Bombardier, said in a telephone interview Sunday. Bombardier will continue to build the Global 5000 and 6000 models as well, he said.
Bombardier’s widely traded Class B stock jumped 4.6 percent to C$4.57 at 10:04 a.m. in Toronto. Earlier the shares touched C$4.81, their highest intraday level since January 2014.
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