Bombardier to cut 5000 jobs as part of new restructuring plan

Bombardier to cut 5000 jobs as part of new restructuring plan

The cuts will come mostly from its aerospace division with some from the firm's rail division.

It also announced it will sell its Q Series turboprop aircraft program to Longview Aviation Capital for $300 million. The stock fell a steep 24.5 per cent, closing at $2.41 per share in Toronto, as the cash flow issue drove new concerns about Bellemare's mission to reshape the Montreal based firm.

Letendre said the job cuts come as the company winds down the development of two big aircraft programs: the C Series passenger jet, which was acquired by Airbus in June and is now known as the A220; and the Global 7500 business jet, which the company announced Wednesday has received Federal Aviation Administration certification with first delivery expected before the end of December.

On the back of the restructuring announcements, Bombardier also unveiled financial forecasts for 2019, with the company saying it's aiming for at least US$18 billion in revenue and adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) reaching as high as US$1.8 billion. "Bombardier has had problems historically and the problem is often that their balance sheet gets into trouble because they chew up a lot of cash", he said.

Bellemare said at the time the company was committed to the Q400 and CRJ.

He offered similar sentiments Thursday. The focus for now is on reducing cost and increasing volumes while optimizing aftermarket revenue for about 1,500 CRJs in service.

Karl Moore, an aviation expert at McGill University's Desautels Faculty of Management, said the layoffs and selloffs will allow Bombardier to shift away from regional jets and shrink its debt.

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Quebec Premier Francois Legault weighed in after speaking with company and union leaders.

A spokesman said the firm does not yet have details on the remaining expected job losses. The provincial government gave the company a lifeline about three years ago by agreeing to invest US$1 billion in the CSeries program.

The announcement came as Bombardier unveiled its third-quarter results, in which pre-tax profits doubled to $267m for the three months to September compared with the same period past year.

On an adjusted basis, Bombardier said it earned four cents per share in the quarter compared with a break-even result in the third quarter of 2017, beating analyst expectations.

"The Dash 8 turbo-prop is the flawless complement to our existing portfolio of specialized aircraft including the Twin Otter and the Canadair CL 215 and 415 series of water bombers", Longview Aviation chief executive David Curtis said in a statement.

Bombardier is selling its turboprop airliner and business jet flight training programs, and cutting 5,000 jobs.

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