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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Nov 16, 2017 1:02 pm

SheikhDjibouti wrote:
[
On a good day, most of us here recognise you have a sensible take on things.
On a bad day, you & I can scrap like a pair of alley cats. :rotfl:
Let's start out as if today is a good day!

Yup, I agree with your analysis.
And Boeing are of course going to pursue this line of attack. No surprises there.
Just as CSALP will defend their position by pointing out that with Airbus on-board, they are anticipating a change in fortune, with many new orders. That alone is justification for opening a second FAL.
Whether it should be located at Mirabel, or Mobile, is another matter. It's not as if Mobile is a green field site for Airbus, or that this is the first time Airbus has established multiple FALs at differing locations.
So Boeing are simply doing the obvious thing. My own opinion is that their argument is weak. And indeed, I strongly suspect that even they do not believe in this line of argument in itself, just that it serves as a useful stalling tactic.
Besides, the lawyers have their own agenda in terms of keeping the legal battle alive. :devil:

I think it boils down to the feeling that what Boeing is doing is unjust, and most of us feel that way.

What I think many people here are not factoring in to this is that the US legal system doesn't necessarily deliver justice.

Think of the whole KC-330 tanker saga. Many feel KC-330 was a good product at a good price. Boeing appealed saying that the decision criteria were not applied correctly, and that was upheld. A second (actually third, but who's counting?) set of proposals were issued that simplified the decision criteria (many say to favor Boeing's product, but still...) and KC-46A is now in production.

We certainly could see the DoC decide use of the Mobile FAL is a circumvention and DL is still liable for the duties. Many would say that's an unjust outcome of the legal system, but Boeing would say we're just playing by the rules.

Jayafe wrote:
Funny how much effort, money and PR Boeing is putting in despising and trying to drop the CSeries off, when they say at the same time that:
1) the project was not worth it for them to buy it
2) the numbers of orders make it unprofitable
3) the construction of a FAL is burning money

And even so they sued to make their US BigBrother applying 300% tariffs and will continue to bull them all around WTO, even when the production will math their “national” demands....

The dilemma comes when Boeing has to argue that this weak product is causing them harm so tariffs have to be applied to it.

SheikhDjibouti wrote:
SomebodyInTLS wrote:
Jayafe wrote:
Funny seeing a cow upside down in the mud


:D

Haven't heard that one before - guess it's a translation of a local phrase. I like it though

I'm guessing the local phrase is based on the much more pithy "it's all gone tits up"
(I do hope those words do not offend the censors here; we are talking about a cow's udders, but resorting to that level of detail kinda destroys the humour angle)

Actually the forum rules do allow for occasional swear words if they are not gratuitous. I think this is an applicable use.

Urban Dictionary ( https://www.urbandictionary.com/define.php?term=tits+up ) gives us the origin:

Origin: when any mammal has died and is on its back, it is "tits up". Things have gone titsup, meaning, the animal/situation has fallen down/gone wrong.
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
CFRPwingALbody
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Nov 16, 2017 6:51 pm

I found this Defense & Aerospace Report youtube video with a interview with Bombardiers President of Commercial Aircraft at the Dubai Airshow.
 
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Revelation
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Re: Airbus and Bombardier Announce CSeries Partnership

Fri Nov 17, 2017 11:38 pm

In https://www.theglobeandmail.com/report- ... e37019891/ we are told that Airbus CEO Tom Enders closed the deal based on gut instinct:

Why would Airbus take over an aircraft program the company's chief salesman mocked as doomed and that Mr. Enders once dismissed as too risky? For Mr. Enders the answer was simple: gut instinct.

"Always in life, human interaction is so important," he said in an interview at Airbus's offices in Munich this week. "It can convince you to make the last step and say, okay, now I'm really convinced. It can also work the other way around. And you say somehow my gut feeling says I don't trust these people."

With Mr. Bellemare, there was immediate trust and "no bullshitting, no trying to manoeuvre around each other."

Other than that, I don't find too much new in this article.

It seems to be aimed at convincing the reader that Airbus is not ripping off BBD. I wonder if that notion is popular in Canada?
Wake up to find out that you are the eyes of the world
The heart has its beaches, its homeland and thoughts of its own
Wake now, discover that you are the song that the morning brings
The heart has its seasons, its evenings and songs of its own
 
bigjku
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Nov 20, 2017 7:55 pm

BBD to issue $900 million in bonds of which 2/3rds refinance debt and 1/3rd would be cash in the bank. The rate is expected to be 7-7.5%.

It’s interesting when compared to comparable Airbus and Boeing bonds. Boeing issued 5 year stuff for about 2.125% earlier this year. Airbus did 1-year at 3.15%.

Some interesting notes with it. They expect as a company to be cash flow neutral on a company basis in 2018 and to hit a per plane breakeven on C-Series in 2020.

It is somewhat interesting that they would refinance bonds not due until 2019 now. They could think that rates are going up, which they are but not much on long end. Or they are hedging against bad news. But they will pay more now that they could delay until 2019. If rates stay flat and the C-Series is turning the corner by then they could presumably pay less then. Then again if something bad happens they could be in worse shape at that point. It’s an interesting play regardless.

It does reflect what several here were saying. BBD still faces cash pressure to get this deal to the date where Airbus looks to be buying and then to meet the proposed terms of financing CSCALP for the first two years.

https://www.reuters.com/article/us-glob ... SKBN1DK02W
 
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LockheedBBD
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Nov 20, 2017 8:03 pm

bigjku wrote:


That link sends me to this article "Oil eases as traders; investors grow edgy ahead of OPEC"

edit: hopefully this one works: https://www.reuters.com/article/bombard ... SL3N1NQ4E8
 
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LockheedBBD
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Nov 20, 2017 8:07 pm

bigjku wrote:

It is somewhat interesting that they would refinance bonds not due until 2019 now. They could think that rates are going up, which they are but not much on long end. Or they are hedging against bad news.



They still need to invest 700 million into the CSeries program as part of the Airbus agreement. Perhaps that could explain it?
 
bigjku
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Nov 20, 2017 8:28 pm

LockheedBBD wrote:
bigjku wrote:


That link sends me to this article "Oil eases as traders; investors grow edgy ahead of OPEC"

edit: hopefully this one works: https://www.reuters.com/article/bombard ... SL3N1NQ4E8


Thanks, I scrolled to far and it changed URL.
 
bigjku
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Nov 20, 2017 9:13 pm

LockheedBBD wrote:
bigjku wrote:

It is somewhat interesting that they would refinance bonds not due until 2019 now. They could think that rates are going up, which they are but not much on long end. Or they are hedging against bad news.



They still need to invest 700 million into the CSeries program as part of the Airbus agreement. Perhaps that could explain it?


BBD will have real cash needs over the next few years. Probably you will see more of this. Debt will be refinanced or new bonds will be issued. The company absent the cash suck of the C-Series should be able to pay them.

If they win on the project their cash intake goes up or Airbus buys them out and they get a cash windfall for it.

If it tanks they have at least set a pretty firm limit on their losses and the combined rest of the company can pay the debts off over time.

Either way I think they are probably a pretty safe investment. Worse comes to worse I suspect Canada will ensure they survive and pay. It is interesting the multiple of risk the market assigns to BBD vs Boeing or Airbus mostly as a reference.
 
Aircellist
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Nov 23, 2017 8:53 pm

Here is an article, in French, in Le Devoir, Montreal's independant newspaper, referencing an interview published in the Globe and Mail, Toronto's biggest newspaper. Both need a subscription, but here are the main points from the french article (I am not a subscriber to the Globe, maybe someone around here is?).

http://www.ledevoir.com/economie/actual ... -par-terre

("To 'negociate' with both knees on the ground")

First, Enders states that the participation of Airbus in the CSeries is a rescuing operation, without guarantees whatsoever.

There is a mention of Boeing's new comments on the rights issue, about the "moribund" state of the "high-risk" program, which came after Boeing had decided not to take BBD's participation offer, then a reminder of the discussions with a potential Chinese buyer that was interested only in patents and know-how. After failing with those two potential suitors, there was no choice left but to go again to Airbus. This time, it worked. Enders mentions that the financial risk was somewhat lessened, that the aircraft was certified and had shown its technical superiority.

In the meantime, BBD, with the 1Bn USD injection, had written off 3,2 Bn USD, out of a program valued at 6 Bn USD, because of cost overruns.

Enders tells about his gut feelings. He states Airbus' participation as pricing power for procurements, worldwide industrial presence and sales force. He sees the CS100 (100-125 seats) and the CS300 (150-160 seats) as complementary to Airbus' own product offering, and the journalist suggests that this implies that the CS500 is not in the cards. However, this "good partner" strategy is a way for Airbus to approach the Canadian military market.

However, Enders confirms that the Mobile new FAL will be paid for by BBD, that it will not guarantee that the US government will accept the CSeries built there as "local" airplanes [my words, not Enders's]. Moreover, the agreement covers a guarantee to maintain the workforce in place in Quebec as in Northern Ireland, yes, but this guarantee is subordinated on the ability to cut costs, which will have to be brought down. Those costs include the Mobile FAL-to-be.

So, it will be necessary to sell more airplanes. BBD was confident the market would be for 6000 planes, Enders sees it a 4000 to 6000, but believes 4000 would already be a lot, and the CSeries should capture about half that market.

Sorry for the sketchy state of this post, but I believe it is interesting, at least in that it solves the debate about who will invest in the Mobile FAL, and that will be BBD only, apparently.

… Honestly, I'm afraid the future is not much clearer for the CSeries. I disliked Planemaker's gloomy vision, but he was more right than I like to admit.
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
ExMilitaryEng
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Nov 23, 2017 9:42 pm

As well stated in the Le Devoir article, the Chinese were strictly interested in the patents and the know how.

BBD would probably have sold them those patents/know how (as they did in the past for the high speed rail technology) had the Feds + Quebec not intervened.

Obviously, the Feds and Québec were way more interrested in keeping the program jobs around than getting upfront whatever $ the Chinese were willing to pay.

Anyways, from a Quebec taxpayer point of view, I'm quite happy to have a diminished (ie shaved by 50%) CSeries program ownership with Airbus onboard than otherwise.

Further to the CSeries itself, Airbus will also make good use of any additional narrow body FAL capacity it can get, and that includes Mirabel. (ie avoiding A319 sales that would cannibalize more profitable A320/321 production slots). For that same reason, I see a CS500 Light (ie a simple CS300 stretch, with less range) even more likely to be launched, as it would be a CASM champion and most often targeted to non Airbus customers.
 
Aircellist
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Nov 23, 2017 10:12 pm

ExMilitaryEng wrote:
Anyways, from a Quebec taxpayer point of view, I'm quite happy to have a diminished (ie shaved by 50%) CSeries program ownership with Airbus onboard than otherwise.

Further to the CSeries itself, Airbus will also make good use of any additional narrow body FAL capacity it can get, and that includes Mirabel. (ie avoiding A319 sales that would cannibalize more profitable A320/321 production slots). For that same reason, I see a CS500 Light (ie a simple CS300 stretch, with less range) even more likely to be launched, as it would be a CASM champion and most often targeted to non Airbus customers.


As another Quebec taxpayer and aircraft lover, I like your optimism and hope that you are right. :-)
"When I find out I was wrong, I change my mind. What do you do?" -attributed to John Maynard Keynes
 
leghorn
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Re: Airbus and Bombardier Announce CSeries Partnership

Sun Nov 26, 2017 2:00 pm

TunisAir to order 2 or 3 CS300
http://www.fliegerfaust.com/cseries-ord ... 59327.html

That is good for a start and gives them entry to another airline from which more orders may follow.

Still better is that the rating agencies has found confidence in them.
https://ledgergazette.com/2017/11/26/ci ... c3-70.html
Citigroup thinks the shares will reach €3.70

At this stage Bombardier Aviation just need to stick to the knitting and work their way out of their unpleasant position.
It is a pity that this news come slightly earlier as then they would have been able to sell 1bn of bonds at a lower interest rate.
https://www.reuters.com/article/bombard ... SL3N1NQ4E8
 
WIederling
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Re: Airbus and Bombardier Announce CSeries Partnership

Sun Nov 26, 2017 3:26 pm

aerolimani wrote:
One has to wonder why Boeing is expending so much effort throwing shade. If the CSeries really has no hope, then why all the fuss?


If you repeat a falseness often enough it (more often than not) is viewed as truth. Boeing is still rather busy seeding the field ...
( Same for A380 bashing )
Murphy is an optimist
 
leghorn
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Dec 04, 2017 12:51 pm

https://www.belfasttelegraph.co.uk/busi ... 76761.html

Airbus will have Belfast Bombardier making Nacelles for their Airbus planes.

In management speak that is a good synergy.
 
ExMilitaryEng
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Dec 04, 2017 4:49 pm

leghorn wrote:
Airbus will have Belfast Bombardier making Nacelles for their Airbus planes.

Well, Airbus is now walking the talks! They are treating BBD as a partner (and way earlier than I thought!).

Let's say that Boeing would not have given subcontracting work to BBD...

I definitely see an eventual shift of the Canadian aerospace business / linkages toward Aibus.
Last edited by ExMilitaryEng on Mon Dec 04, 2017 4:59 pm, edited 1 time in total.
 
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JetBuddy
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Re: Airbus and Bombardier Announce CSeries Partnership

Mon Dec 04, 2017 5:06 pm

leghorn wrote:
https://www.belfasttelegraph.co.uk/business/northern-ireland/bombardier-in-northern-ireland-to-make-new-nacelles-for-airbus-jets-36376761.html

Airbus will have Belfast Bombardier making Nacelles for their Airbus planes.

In management speak that is a good synergy.


Excellent news! Shows how serious they are about this deal.
 
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Brixerl
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Dec 28, 2017 8:20 am

In the meantime he german Bundeskartellamt has cleared the acquisition of C Series Aircraft Limited Partnership, Canada ("CSALP"), a subsidiary of Bombardier Inc. Montreal, Canada, by Airbus SE, Leiden, Netherlands.

And - interesting wording concerning the ongoing dispute between Boeing and Bombardier:

Andreas Mundt, President of the Bundeskartellamt: "The merger will not significantly impede effective competition in this sector. As Airbus manufactures mainly commercial aircraft with a seating capacity of more than 150 seats and the Bombardier subsidiary CSALP manufactures exclusively smaller aircraft, the companies are not in close competition with one another. CSALP does have a strong position on the worldwide market for smaller aircraft with 100 to 150 seats. However, our investigations have shown that this type of aircraft is of secondary importance for European and, in particular, German carriers."
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Dec 28, 2017 4:35 pm

leghorn wrote:
https://www.belfasttelegraph.co.uk/business/northern-ireland/bombardier-in-northern-ireland-to-make-new-nacelles-for-airbus-jets-36376761.html

Airbus will have Belfast Bombardier making Nacelles for their Airbus planes.

In management speak that is a good synergy.


Shorts (BBD Belfast) has been making A320 V2500 nacelles for years...
 
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Re: Airbus and Bombardier Announce CSeries Partnership

Thu Jan 18, 2018 6:02 pm

Some progress regarding the assembly line in Mobile:

Bombardier has already made "significant" progress towards opening an Alabama CSeries final assembly site that will closely resemble the company's Mirabel assembly facility.

"Bombardier… is moving ahead posthaste, obtaining regulatory approvals, conducting site visits and planning, consistent with antitrust law, for the operation of the US [final assembly site]," says a 17 January document filed with the US International Trade Commission (ITC).

The company has made "significant further progress toward construction of the US" site since 27 December, adds the document, signed by an attorney with Covington & Burling, a law firm representing Bombardier.


Full article
https://www.flightglobal.com/news/artic ... la-445019/
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