Oct. 18, 2017, © Leeham Co.: It was the annual media day in 2010 that Airbus declared war on the Bombardier CSeries.
Lufthansa Group in 2009 was the launch customer of the CSeries with an order for 30 CS100s and options for 30 more.
Bombardier had won a major order from Republic Airways Holdings, which then owned Frontier Airlines, an exclusive A319/320 operator. Republic ordered 40 CS300s and optioned 40 more. It was this order that spurred Airbus’ wrath. It was this order that would push Airbus into launching the re-engined A320neo family.
John Leahy, Airbus COO-customers, and Tom Williams, then EVP of programs, declared to the assembled international media that Airbus would aggressively compete against Bombardier.
Now, seven years later, Airbus and Bombardier are partners.
By Bjorn Fehrm
October 18, 2017, ©. Leeham Co: Bombardier and Airbus changed the airliner landscape yesterday. Analysts say it’s the largest industry change since Boeing bought McDonnell Douglas in 1997.
So, what has Airbus bought for no money? A me-too, or a world-beater?
The analysis focused on the US is natural, given the Boeing trade complaint involving the CSeries sale to Delta Air Lines.
But it’s important to step back to see what this means for CSeries.
Oct. 16, 2017, © Leeham Co.: The stunning Airbus-Bombardier partnership for the CSeries program guarantees the future of the new airplane, kills off the A319 and thrusts a big stick up Boeing’s tailpipe.
Boeing won big victories in its trade complaint filed with the US government, winning 300% tariffs on every CSeries imported into the US, throwing into doubt a big deal with Delta Air Lines for up to 125 aircraft.
Airbus and Bombardier Announce C Series Partnership
Airbus to acquire majority stake in the C Series Aircraft Limited Partnership
Partnership brings together two complementary product lines, with 100-150 seat
market segment expected to represent more than 6,000 new aircraft over the next 20
Combination of Airbus’ global reach and scale with Bombardier’s newest aircraft family
to create significant value for customers, suppliers, employees and shareholders
Significant C Series production costs savings anticipated by leveraging Airbus’ supply
Commitment to Québec: C Series Aircraft Limited Partnership headquarters and
primary assembly to remain in Québec, with the support of both companies’ global
Airbus’ global industrial footprint expands with the C Series Final Assembly Line in
Canada, resulting in a positive impact on operations in Québec and across the country
Growing market for C Series results in second Final Assembly Line in Mobile,
Alabama, serving U.S. customers.
Oct. 10, 2017: The US Department of Commerce concluded Bombardier was uncooperative, didn’t answer its questions and impeded the trade investigation in the Boeing complaint.
Accordingly, under US law, Commerce could draw negative conclusions toward Bombardier and found it “guilty” (our word) of violating anti-dumping laws in its sale of the CS100 to Delta Air Lines.
Oct. 3, 2017, © Leeham Co.: The other shoe in the Boeing-Bombardier trade complaint is to drop Wednesday when the US Department of Commerce makes its decision whether Boeing suffered harm, or there is a threat of harm, in the CS100 order by Delta Air Lines.
The DOC last week determined that Bombardier received illegal subsidies dating to the 2008 program launch of the CSeries, through the 2016 equity investments by the provincial government of Quebec and the federal government of Canada. Certain tax breaks were also deemed illegal subsidies by the DOC.
The determination was expected, even by Bombardier. But the DOC shocked the global aviation community by levying a 220% tariff. The rate is preliminary and won’t be finalized until next year, but absent some extraordinary event, it’s expected to be confirmed—followed by lengthy appeals.
The decision Wednesday relates to harm, or anti-dumping in legal terms. Here’s where the aviation community and observers, except for one who is prominent and who receives funding from Boeing, universally believe there is no case.
Oct. 1, 2017, (c) Leeham Co.: Monarch Airlines ceased operations today (Oct. 2 in the UK) when its operating license was withdrawn and an Administrator appointed, the BBC reported.
The airline has 32 Boeing 737-8 MAXes on order. It operated a fleet of 34 Airbus A320s/A321s. Principal lessors are AerCap and Aviation Capital Group, according to the Airfinance Journal Fleet Tracker.
Given the current trade war between Boeing and Bombardier, there may be a sigh of relief in Montreal. Boeing beat out Bombardier in winning the MAX 8 order against the CS300 in 2014.