Bombardier Sees More Regional Jet Orders in 2018 After Delta

(Bloomberg) -- Bombardier Inc. is building momentum to expand orders for its CRJ regional jets this year after securing a deal with Delta Air Lines Inc. -- its second in two months.

Delta on Wednesday agreed to purchase 20 of Bombardier’s CRJ900 aircraft valued at about $961 million based on list prices. The deal followed an agreement with American Airlines Group Inc. in May for at least 15 jets, and brings the total order tally for the CRJ family to 1,953 since the planes first began flying in 1992.

“I am optimistic that things will happen this year” on the order front, Bombardier Commercial Aircraft president Fred Cromer said Thursday in an interview in Mirabel, Quebec.

Airbus SE’s agreement to take control of Bombardier’s C Series program puts the company’s commercial aircraft focus back on the CRJ family. Sales of the regional jets have slowed in recent years as the Montreal-based manufacturer invested more than $6 billion to develop the C Series.

Bombardier’s current CRJ jets seat 66 to 104 passengers.

Cabin Appeal

Customer interest in the CRJ in the U.S. and other regions has been boosted by a new cabin, called Atmosphere, which Bombardier introduced last year. The company is now considering whether to use the cabin -- which features larger overhead storage bins -- on its Q400 line of turboprop planes to spark sales, Cromer said.

The move “has been in our thinking for some time,” Cromer said. “That’s an opportunity. It’s not big in investment dollars. It’s a current project and we will see where it goes.”

Bombardier is committed to the Q400 “long-term” and will focus on cutting production costs to improve margins, Cromer said. Bombardier produces the turboprop at its Downsview facility in Toronto, which the company sold earlier this year and will continue to operate for three to five years.

“We have three to five years to decide the right industrial strategy for the Q400,” Cromer said. “We want to create more profitability for the program.”

Potential opportunities include producing parts of the planes in lower-cost countries such as Mexico, Cromer said. The Q400 can seat as many as 90 passengers.

©2018 Bloomberg L.P.

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