It is the end of an era for Bombardier as the Canadian aerospace company announced Thursday it is getting out of the commercial aviation business in a bid to pay down billions of dollars in debt.
The company lost $1.61 billion in 2019 and finds itself with total debt of $10 billion.
Bombardier sold its remaining stake in the CSeries plane -- now called the Airbus SE A220 program -- to Airbus through the aircraft maker’s European subsidiary Stelia Aerospace.
The sale price is $591 million.
Airbus’s share in the A220 program jumps to 75%, up from about 50%, while the province of Quebec will see its ownership go to 25% from 16%. The province invested CAN$1 billion in the company to help it survive.
As well, the deal negates Bombardier’s commitment to make investments worth about $700 million in the jet program.
Airbus reported the sale will not affect the 3,300 jobs in Quebec.
“The CSeries was a cash drain,’ Bombardier chief executive Alain Bellemare said Thursday. “The strategy was always to exit commercial aircraft while protecting jobs.
“We’ve done that [in] a very responsible [manner].”
The A220 was awarded accolades by airline companies for its fuel efficiency and cabin size, but the plane was more than two years late in production and $2 billion over budget.
Bombardier said it has also entered into agreements to sell its regional-jet operation and its wing plant in Northern Ireland.
The wing plant employs about 3,600 skilled workers and there were no details as to whether the jobs would be affected by the sale. It is one of Northern Ireland’s largest employers.
