Airbus-Bombardier deal likely to jumpstart CSeries jet sales in Asia: analysts

On Tuesday, industry analysts have opined that with Airbus SE deciding to have a majority stale in Bombardier Inc’s CSeries jet program, the sale of its aircrafts in the booming Asian market could skyrocket.

As part of the the Airbus-Bombardier deal, the European planemaker will receive a 50.01% interest in the CSeries program while Bombardier will get access to Airbus’ better sales network.

The deal comes in the wake of Bombardier not managing to secure a new order for the 110-to-130 seater airplane for the last 18 months and is being threatened with a 300% rise in duty by the Trump Administration.

Bombardier’s Asian customer, Korean Air Lines Co, is so far the only customer for its narrowbody jets and is slated to take delivery of the first of 10 CS300 aircraft in the near future.

“Interest in the CSeries has been low in this region and having Airbus supporting the program could be a big boost,” said Brendan Sobie, Singapore-based chief analyst at CAPA Centre for Aviation.

Airbus has a strong market presence in Asia than Bombardier, which is in the middle of a five year turnaround plan after contemplating bankruptcy due to a cash-crunch.

Airlines in Asia have largely held back placing orders citing Bombardier’s weak financial position, said Shukor Yusof, founder of Malaysia-based aviation advisory firm Endau Analytics.

He went on to add, “Potential buyers of the CSeries are now given comfort with Airbus becoming a major shareholder thus ensuring stability in the program”.

Several Asian airlines could not be reached immediately for comment on the Airbus-Bombardier deal.

China has been one of Bombardier’s dreams and it has been trying hard to sell the CSeries in China, with its executive saying last month that the planemaker was in talks with the country’s three top airlines and aims to close deals in the coming months.

Incidentally, China is working to develop its own homemade airlines to break the grip that Boeing Co and Airbus have over the global commercial aerospace industry.

As a narrowbody jet with a range of more than 3000 nautical miles, the CSeries fills a gap between China’s 90-seat ARJ21 regional jet and its larger 158 to 168 seat C919 narrow body.

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