Bombardier to cut 2,500 jobs worldwide

Marco Green
June 6, 2020

In a press release yesterday, Canadian plane maker Bombardier said that it would be reducing its workforce by approximately 2,500 employees.

"It is very unfortunate to have to resort to these reductions".

The move comes amid a time of near-universal uncertainty throughout the aviation industry due to a dramatic, worldwide drop in global travel since the beginning of the COVID-19 pandemic.

"We are now faced with the hard decision to adjust the size of our business, considering both disruptions in our supply chain as well as industry-wide forecasts calling for approximately 30% year-over-year drops in unit deliveries due to the pandemic", David Coleal, president of Bombardier Aviation, said in a memo to workers about the layoffs which was seen by Reuters.

In a report by Reuters, the International Association of Machinists and Aerospace Workers (IAM) said that the layoffs could be avoided.

The company said it expects business jet deliveries to be down 30% industry wide.

The company, which recently exited the commercial aircraft business, is in the process of selling its rail business to French train maker Alstom for up to 6.2 billion euros ($7.02 billion).

RBC Capital Markets analyst Walter Spracklin said in a note to clients on Friday that Bombardier's decision marks "the first indication from the company quantifying the magnitude of declines".

On Monday, it closed the sale of its CRJ regional jet program to Mitsubishi Heavy Industries Ltd. for US$550 million.

The business aircraft segment had initially expected double-digit revenue growth this year with 160 unit sales in 2020 amid a US$16.3-billion backlog and had begun to ramp up production when the pandemic hit in March.

Yesterday, Bombardier Aviation announced that it would be cutting around 2,500 jobs, mostly in Canada. Further information will be provided when it delivers its second-quarter financial results on August 6.

Other reports by Click Lancashire

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