Bombardier Bizjet Shipments To Slide after Flat 2015

Bombardier delivered 199 business jets last year and expects shipments to drop by nearly a quarter this year, to about 150 business aircraft, the Canadian-based aircraft manufacturer said today during its fourth-quarter conference call. It will also lay off 500 people at its business aircraft segment and a further 6,500 at other divisions—the bulk at aerostructures and engineering services (2,500) and transportation (3,500)—over the next two years.

Last year, Bombardier Business Aircraft had revenue of $6.996 billion, down from $7.2 billion in 2014, while recording a loss of $1.252 billion after a special writedown of about $1.4 billion for the canceled Learjet 85 program. It sustained a $903 million loss in 2014 after accounting for a $1.3 billion writedown, also attributed to the Learjet 85 program.

Bombardier’s business aircraft deliveries last year comprised 73 Global 5000/6000s, 68 Challenger 300/350s, 25 Challenger 605/650s, one Challenger 850 and 32 Learjet 70/75s. This was down slightly from 204 shipments—80 Globals, 54 Challenger 300/350s, 36 Challenger 605s, 33 Learjet 70/75s and one Learjet 60XR—in 2014. The company removed the Learjet 60XR and Challenger 850 from its product line-up in December, it said.

Gross business jet sales also fell last year, to 119 aircraft, from 181 in 2014. After accounting for Learjet 85 cancellations and restructuring certain customer agreements in the third quarter, net sales were -21, compared with 129 in the previous year. Bombardier’s business jet backlog stood at $17.2 billion as of December 31, some $7 billion lower than a year earlier.