Airbus and Bombardier Announce CSeries Partnership

ytz · Tue Oct 17, 2017 5:08 am

kitplane01 wrote:

Airbus has been given a new opportunity at zero cost. If it's profitable, they win. If it's unprofitable, they don't lose (since they invested nothing).

Exactly. What a win for Airbus....and for all of us plebes who fly economy everywhere.

NWAROOSTER · Tue Oct 17, 2017 5:08 am

Airbus is buying into BBD and the C Series as Airbus knows they can make a BUCK or EURO. That is the main reason for this transaction. :old:

Momo1435 · Tue Oct 17, 2017 5:09 am

I think Boeing already knew this deal was in the works and decided to make Airbus a bit difficult to make sure the import tariffs were enforced before the Airbus Bombardier deal went ahead. Without it Airbus could have just used 1 assembly in Canada and the C Series got a lot of negative press in the large market that is the USA.

Airbus wasn't really aiming at Boeing with this purchase, but much more at the Chinese industry which also could have picked up the C Series and create an easy inroad for Chinese aircraft manufactures into the world market. Which in the long run would have caused a much larger issue for both Airbus and Boeing. It also sends a clear message to any smaller aircraft manufacturer that could have plans to try to enter the A320 / 737 market: "You cannot do it without us". That makes it harder for Boeing to do something similar, as Embraer or Mitsubishi won't start to think anytime soon on something larger then their current portfolio.

kitplane01 · Tue Oct 17, 2017 5:10 am

Revelation wrote:
Jon Ostrower tweeted:

2) Airbus gives it moderate support with the goal of getting to break even so Airbus can get the intellectual property of the program at minimal cost in 2023, which is still 2 years before Boeing can do a MOM.
?

What would be the point. They would own a design that breaks even. Not much profit in that, even if it was free. Airbus only wins if the C-series makes a profit.

ytz · Tue Oct 17, 2017 5:11 am

The E2 and MRJ are too small. Next logical conclusion is for Boeing to tie up with COMAC or Irkut. My money is on China. You heard it here first.

MSPNWA · Tue Oct 17, 2017 5:12 am

ytz wrote:
People must not like beer.

Honestly, I don't like it that much. You can keep it. I'll take straight cash though.

aerolimani wrote:
False. Airbus' own press release says they plan to build CSeries in Mobile, Alabama. Do you think they would start up a parallel assembly line, in the USA, just for fun?

It's coded as "growing market", but everyone knows it's really about tariff evasion. The CSeries is nowhere close to needing another manufacturing line to meet demand. So in a way it is just for fun. I doubt the US government will look kindly at the clear effort to evade tariffs.

tommy1808 · Tue Oct 17, 2017 5:12 am

Jamie514 wrote:
downdata wrote:
Majority stake hmmmm. Well i guess they were backed into a corner and had no options left but to cede control. This is great news but only for airbus. Boeing is the biggest loser but canadian aerospace industry didnt really win either.

Did they really cede all control? I thought the bullet points called it a joint venture and project admin remains in Quebec...

If you own 50% plus 1 share, you have pretty much all control. There are still blocking minorities, but that is as close to full control as you can get without owning more than 75%/95% (may be different number in Canada).

best regards
Thomas

MD80MKE · Tue Oct 17, 2017 5:14 am

ytz wrote:
I'm still not getting PMs. People must not like beer. My wager offer is for the end of 2018.

Either:

1) Deal with JetBlue.
2) 15% larger order book for the CSeries. As per quick Wiki, that means selling 54 more frames.

I am in California at the moment. Great craft brew here.

How 'bout UAL getting a package deal for CS100/CS300 and A321neo? :stirthepot:

Not gon bet on this but always welcome to hang in South Bay.

kitplane01 · Tue Oct 17, 2017 5:19 am

airzona11 wrote:
This is a short term cash infusion, for a quick return, who knows the politics involved or the vision. It is not for the CS500 8 years from now.

No it's not. No cash changed hands. No actual cash was invested. This is not a short term cash infusion.

ytz · Tue Oct 17, 2017 5:20 am

MSPNWA wrote:

Honestly, I don't like it that much. You can keep it. I'll take straight cash though.

Cash is crass to me. But drinks on me if we ever cross paths.

MSPNWA wrote:
aerolimani wrote:
False. Airbus' own press release says they plan to build CSeries in Mobile, Alabama. Do you think they would start up a parallel assembly line, in the USA, just for fun?

It's coded as "growing market", but everyone knows it's really about tariff evasion. The CSeries is nowhere close to needing another manufacturing line to meet demand. So in a way it is just for fun. I doubt the US government will look kindly at the clear effort to evade tariffs.

I fail to see what they can do. It's not illegal for Airbus to make and sell airplanes in the US. And how exactly they do tariff imports like airframes and engines?

ytz · Tue Oct 17, 2017 5:21 am

MD80MKE wrote:
ytz wrote:
I'm still not getting PMs. People must not like beer. My wager offer is for the end of 2018.

Either:

1) Deal with JetBlue.
2) 15% larger order book for the CSeries. As per quick Wiki, that means selling 54 more frames.

I am in California at the moment. Great craft brew here.

How 'bout UAL getting a package deal for CS100/CS300 and A321neo?
Not gon bet on this but always welcome to hang in South Bay.

As Star Gold, I wish! No more 17" seats!

kitplane01 · Tue Oct 17, 2017 5:27 am

My predictions. You can grade me when the future is known.

It would be interesting to see other people's predictions.

1) There will be a significant order for the C-series in the next 9 months. At least 40 planes, or 25 orders + 25 options.

2) There will be no CS500. Ever.

3) Bombardier will have to invest more money in the program. Airbus will not.

4) Bombardier does not reveal new development plans in the next two years. No Q400+. No CRJneo.

5) Boeing does not buy Embraer or the Mitsubishi Regional Jet for the next three years.

6) The C-series does not make money in the next 5 years.

7) Airbus buys the whole program for small change (they want the support contracts for the next decades).

8) Delta gets their planes

9) No significant anti-trust things happen.

10) This will be like Airbus's investment into ATR. It does not fundamentally change everything, and ATR is stymied from developing future models.

Finn350 · Tue Oct 17, 2017 5:36 am

Wow, 360 replies in seven hours. Congrats to Airbus and Bombardier for the deal.

I didn't have time to read all the posts, but regarding regulatory approval: US and Boeing can still make things difficult. On the other hand, Boeing and McDonnell Douglas merger went through earlier.

ytz · Tue Oct 17, 2017 5:38 am

Jetport wrote:
kabq737 wrote:
If the Cseries is able to take advantage of the massive Airbus support structure and product familiarity around the world it could be very very good. I love Boeing’s aircraft however, I think they are run fairly poorly right now and I think this wake up call needed to be made.

Boeing run poorly right now?? What are you smoking?? Check out their stock price, if only all public companies were so poorly run. As one analyst said; "Boing is a cash flow machine". I wish I had bought far more Boeing stock than I did last year. BA is the best performing stock in the Dow for the past year. I guess you are smarter than wall street.

http://www.marketwatch.com/investing/st ... tory_quote

Watch the after-market ticker today and opening bell tomorrow. Wall Street is notoriously shortsighted because all they do is chase quarterlies. This is the end result. Boeing should have gotten in there and grabbed Bombardier before Airbus.

airzona11 · Tue Oct 17, 2017 5:39 am

From Airbus CEO Tom Enders "Pair in talks since August....said the arrangement wasn't motivated by Boeing's suit. Airbus and Bombardier attempted to link up in 2015, but those talks fell through once news of the negotiations became public."

ExDubai · Tue Oct 17, 2017 5:40 am

MD80MKE wrote:
ikolkyo wrote:
Not trying to say they are one family but now Airbus can sell the aircraft as package from as low as 100 seats to as many as 240 seats in a High Density A321neo. For example JetBlue, I'm willing to be their interest in the CSeries has skyrocketed over the E2 since its now basically Airbus's program and they are large A320 family operator.

Exactly.

But they lost one important USP, the commonality. CCQ is a nice thing, it took me 10 days from the A320 to the A330. This is a problem Airbus needs to sort out (which will cost a lot of money)

aerolimani · Tue Oct 17, 2017 5:41 am

MSPNWA wrote:
It's coded as "growing market", but everyone knows it's really about tariff evasion. The CSeries is nowhere close to needing another manufacturing line to meet demand. So in a way it is just for fun. I doubt the US government will look kindly at the clear effort to evade tariffs.

Well… it would be hard for the US gov't to complain. With the tariffs in place, most potential CSeries sales would probably have gone to Embraer. Instead, now there will be new jobs created in a state which voted for Trump.

kitplane01 wrote:
This will be like Airbus's investment into ATR. It does not fundamentally change everything, and ATR is stymied from developing future models.

Specifically referring to the CSeries program, and CS500 development is in the hands of Airbus, yes. I assume that's what you're saying.

Technically, BBD could still develop another aircraft. Obviously, that's not going to happen. Nonetheless, it is true that BBD remains an independent corporation. They only lost their controlling interest in the CSeries program specifically.

ExDubai · Tue Oct 17, 2017 5:43 am

tomaheath wrote:
EMBSPBR wrote:
Siddar wrote:
Boy you Canadians sure showed us in the US. You sold the company to Europeans who will make C Series in the US. Real Trudeau definition of winning you got there. I think ill stick to Trumps definition. I want to thank Quebec government for subsidizing Alabama job and Taxs.

Apparently few have noticed this ...

Very well put. Seems like just a easy way to get a competitor out of the game. That’s the way I’m seeing it anyways.

Looking from a different angle, it seems like an easy way to keep an possible competitor (COMAC) out of the game. At least for a few years...

lightsaber · Tue Oct 17, 2017 5:44 am

kitplane01 wrote:
My predictions. You can grade me when the future is known.

It would be interesting to see other people's predictions.

1) There will be a significant order for the C-series in the next 9 months. At least 40 planes, or 25 orders + 25 options.

2) There will be no CS500. Ever.

3) Bombardier will have to invest more money in the program. Airbus will not.

4) Bombardier does not reveal new development plans in the next two years. No Q400+. No CRJneo.

5) Boeing does not buy Embraer or the Mitsubishi Regional Jet for the next three years.

6) The C-series does not make money in the next 5 years.

7) Airbus buys the whole program for small change (they want the support contracts for the next decades).

8) Delta gets their planes

9) No significant anti-trust things happen.

10) This will be like Airbus's investment into ATR. It does not fundamentally change everything, and ATR is stymied from developing future models.

1. Yes, an order. But who?
2. I don't know about the CS500. It depends how much Airbus owns. I could see so after they buy out Bombardier. :devil:

3. The contract is in Airbus' favor...
4. I think Bombardier is done in commercial aircraft.

5. I agree Boeing will not buy Embraer of the MRJ. It just isn't worth their effort.
6. How much money will depend on future sales.
7. I think the C-series will do better than small change. I do think Airbus will buy out the program.
8. Yes, DL gets their planes, just late for Mobile to learn the process.
9. I agree, the anti-trust is for imports. This will be assembled out of majority US parts in Mobile.

Lightsaber

KrustyTheKlown · Tue Oct 17, 2017 5:52 am

From a Leeham article back in May:

"Boeing told the US International Trade Commission in a May 24 closing brief that Bombardier, in essence, will become the next Airbus if the ITC does nothing to penalize Bombardier by slapping 79% tariffs on the Delta aircraft."

And now, thanks in part to Boeing's complain, the C Series became an Airbus plane.

If that's not irony I don't know what it is.

ExDubai · Tue Oct 17, 2017 5:54 am

Revelation wrote:
william wrote:
http://money.cnn.com/2017/10/16/news/companies/airbus-buys-majority-stake-bombardier-cseries/index.html

Seems like Boeing is pretty butthurt:

"This looks like a questionable deal between two heavily state-subsidized competitors to skirt the recent findings of the U.S. government. Our position remains that everyone should play by the same rules for free and fair trade to work," a Boeing spokesman said in a statement.

Yepp, got a couple of comments from some Boeing guys via messenger. Can't quote them because of the abusive language :lol:

ExDubai · Tue Oct 17, 2017 5:58 am

lightsaber wrote:
4. I think Bombardier is done in commercial aircraft.

Yepp, at least in the 100+ plus market. They made to many mistakes during the C-series development...

ytz · Tue Oct 17, 2017 6:12 am

@Revelation,

For next large customer, I posit IAG. The CSeries fits well for them. Especially for Aer Lingus and British Isles flying.

KrustyTheKlown · Tue Oct 17, 2017 6:12 am

Boeing guys should cherish that now they'll get to build their New Small Airplane instead of keep putting lipstick on a 1960's design.

I think that with Airbus now having 2 families of modern narrow body aircraft Boeing will not launch a further 737 refresh (MAXX?) but instead will be forced to develop a new aircraft (that combined with the simultaneous MOM program could stretch a little their engineering and/or financial assets).

JannEejit · Tue Oct 17, 2017 6:17 am

ytz wrote:
@Revelation,

For next large customer, I posit IAG. The CSeries fits well for them. Especially for Aer Lingus and British Isles flying.

Assuming Willie Walsh backs down on his assertion the C Series is "too much plane for British Airways". Possibly also applies to Aer Lingus in it's regional UK flying form too.

JannEejit · Tue Oct 17, 2017 6:18 am

ytz wrote:
@Revelation,

For next large customer, I posit IAG. The CSeries fits well for them. Especially for Aer Lingus and British Isles flying.

Assuming Willie Walsh backs down on his assertion the C Series is "too much plane for British Airways". Possibly also applies to Aer Lingus in it's regional UK flying form too.

JannEejit · Tue Oct 17, 2017 6:19 am

ytz wrote:
@Revelation,

For next large customer, I posit IAG. The CSeries fits well for them. Especially for Aer Lingus and British Isles flying.

YIMBY · Tue Oct 17, 2017 6:20 am

Wow, a surprise I was expecting to happen. While secretly hoping BBD to grow up as a third major manufacturer, and knowing thats impossibility, this may be the best solution to save CSeries. Definitely Airbus gives the missed credibility to the program, and I do not believe that Canadians gave it to Airbus to terminate it. While Airbus owns majority, it does not give dictatorial powers, as there evidently will be hard contracts between shareholders how to run the company.

I expect to see CSeries airbused in the future, maybe to be sold as A110, A130 and A150, or whatever, the "A150"/CS500 being the first "Airbus". Converting the other CSeries models to Airbus would be no easy task, with all mission creep a billion scale project. Adding the CS500 will help Airbus as it competes much more with 738 than A320, and is notably lighter with smaller range.
That also gives room for Airbus to grow 320 series, with a larger wing and new lengths, maybe called 328/329.

Aircellist · Tue Oct 17, 2017 6:23 am

So, fundamentally, BBD is paying for AB to sell the CSeries? And all that will come to an end after two election cycles from now? Splendid face saving…
I do hope the CSeries does not get killed… with very moderate optimism. I am even less optimistic about BBD's mid-term survival, and not only in the aerospace business. Nothing seems to be rolling for them, now.
Congratulations to Airbus. And to Boeing, well…

Aircellist · Tue Oct 17, 2017 6:25 am

… An interesting aspect is that now Airbus will own the design of an artificial-feel side stick…

aerolimani · Tue Oct 17, 2017 6:27 am

KrustyTheKlown wrote:
Boeing guys should cherish that now they'll get to build their New Small Airplane instead of keep putting lipstick on a 1960's design.

I think that with Airbus now having 2 families of modern narrow body aircraft Boeing will not launch a further 737 refresh (MAXX?) but instead will be forced to develop a new aircraft (that combined with the simultaneous MOM program could stretch a little their engineering and/or financial assets).

And, when they overstretch, the gov't steps in because they're "too big too fail," and the EU slaps tariffs on them for being subsidized! :duck:

Okay… I'm being facetious, and don't really see things getting that bad, as much as I wouldn't mind seeing Boeing get a taste of their own medicine. Still, there could be some challenges ahead for Boeing, depending on what Airbus does with this. Putting aside my sad feelings for BBD… this story is definitely the most interesting thing to happen in the aviation world in quite some time.

FoxtrotSierra · Tue Oct 17, 2017 6:30 am

ExDubai wrote:
Yepp, got a couple of comments from some Boeing guys via messenger. Can't quote them because of the abusive language

People working at Boeing actually support egging BBD?!? I was under the impression that all of this was just among Boeing's corporate circles.

tommy1808 · Tue Oct 17, 2017 6:31 am

Finn350 wrote:
US and Boeing can still make things difficult. On the other hand, Boeing and McDonnell Douglas merger went through earlier.

It would be sort of odd i the US tried to block a Canadian Company sell something to a European Company, or stopping that European company from investing money in the US. And Alabama would probably sue the hell out of the federal government for even trying.

They may complain that Bombardier is selling to part of the program too cheap, but they themselves just reduced the market value of that program.

best regards
Thomas

FoxtrotSierra · Tue Oct 17, 2017 6:33 am

KrustyTheKlown wrote:
From a Leeham article back in May:

"Boeing told the US International Trade Commission in a May 24 closing brief that Bombardier, in essence, will become the next Airbus if the ITC does nothing to penalize Bombardier by slapping 79% tariffs on the Delta aircraft."

And now, thanks in part to Boeing's complain, the C Series became an Airbus plane.

If that's not irony I don't know what it is.

Now this is irony. And the best part is that it happened after they jacked up the tariffs waaaay past 79% which epicly backfired in the most spectacular fashion imaginable, with BBD richocheting away straight to Airbus. This is the corporate definition of shooting yourself in the foot, and one level above that in a duopoly.

I can't wait to see the CSeries at SEA in DL colors flying right over Everett, it'll be even better than when QR flew their A380 to ATL.

flyabr · Tue Oct 17, 2017 6:33 am

KrustyTheKlown wrote:
Boeing guys should cherish that now they'll get to build their New Small Airplane instead of keep putting lipstick on a 1960's design.

The smallest model of the next NB from Boeing will probably be larger than the CS300, so there is no hurry!

Dutchy · Tue Oct 17, 2017 6:59 am

flyabr wrote:
KrustyTheKlown wrote:
Boeing guys should cherish that now they'll get to build their New Small Airplane instead of keep putting lipstick on a 1960's design.

The smallest model of the next NB from Boeing will probably be larger than the CS300, so there is no hurry!

I agree the downside for Boeing is that they then they leave the 150- marked to Airbus (and a bit to China and Russia, but those aren't real competitors yet on the international stage).

ThePointblank · Tue Oct 17, 2017 7:06 am

Dutchy wrote:
flyabr wrote:
KrustyTheKlown wrote:
Boeing guys should cherish that now they'll get to build their New Small Airplane instead of keep putting lipstick on a 1960's design.

The smallest model of the next NB from Boeing will probably be larger than the CS300, so there is no hurry!

I agree the downside for Boeing is that they then they leave the 150- marked to Airbus (and a bit to China and Russia, but those aren't real competitors yet on the international stage).

The way I see it is that Airbus got a clean-sheet aircraft program for practically nothing, while Boeing is now in the position where they will have to invest billions in developing a whole new family of aircraft to replace the 737 and develop the MoM concept. Airbus just has to develop the A320 series more towards the upper end, and that just means 1 development program for them. Boeing will need to tackle 2 programs at once.

NolaMD88fan · Tue Oct 17, 2017 7:06 am

Just from a spotting perspective, personally looking forward to driving the 90 minutes over to the Airbus Mobile Assembly Facility and watching the C-Series planes go through flight testing.

ytz · Tue Oct 17, 2017 7:11 am

So how long till DL exercises all 50 options and converts whatever they can to CS300 on the sweet deal they got?

As per Wiki, they've got just under 70 A319s and B73G. And assuming the CS100 wasn't a 717 replacement another 91 birds to replace. That's 160 frames right there.

That alone is enough to keep Mobile busy for a bit.

Dutchy · Tue Oct 17, 2017 7:19 am

ThePointblank wrote:
Dutchy wrote:
flyabr wrote:

The smallest model of the next NB from Boeing will probably be larger than the CS300, so there is no hurry!

I agree the downside for Boeing is that they then they leave the 150- marked to Airbus (and a bit to China and Russia, but those aren't real competitors yet on the international stage).

The way I see it is that Airbus got a clean-sheet aircraft program for practically nothing, while Boeing is now in the position where they will have to invest billions in developing a whole new family of aircraft to replace the 737 and develop the MoM concept. Airbus just has to develop the A320 series more towards the upper end, and that just means 1 development program for them. Boeing will need to tackle 2 programs at once.

Yes, or abandon one marketplace. So a loose - loose for Boeing. For Airbus, develop the A322 and give the MoM a run for its money and keep the prices in check.

dampfnudel · Tue Oct 17, 2017 7:27 am

It sure backfired on Boeing. Now, Airbus will gain even more market share in NA with its powerhouse of a narrow-body lineup (CS100/300/500? and 320/321neo). Delta will now get their CSeries aircraft without any tariff and even more with another order, perhaps including 320/321neo aircraft. Other US carriers like B6 and AA may decide it's safe to order the CSeries (A360?) now that Airbus is involved. The chances of the CS500 seeing the light of day have increased significantly now. Ed Bastian must be smiling right now. LH Group is probably even closer to another order for the CSeries than they were before, given that Airbus is running the show now.

RalXWB · Tue Oct 17, 2017 7:32 am

Now we know why Delta never mentioned a cancellation. Fantastic news for Airbus! The B-squad must be so mad :rotfl:

Balaguru · Tue Oct 17, 2017 7:36 am

Well, does it mean more jobs in Mobile?
How did Boeing lawyers not anticipate this? Too cocky?

armchairceonr1 · Tue Oct 17, 2017 7:37 am

One part of the deal is that Airbus get warrants to buy 5% stake of Bombardier.

DeanBNE · Tue Oct 17, 2017 7:40 am

No more A318NEO

2175301 · Tue Oct 17, 2017 7:41 am

I believe that Airbus will wind down the 319 program (not instantly dead.... but, likely no more active sales efforts shortly); and, that the CS500 development will start within a year - with primary assembly slated for the US.

Have a great day,

MD80MKE · Tue Oct 17, 2017 7:45 am

Just a FYI, a CS300 test aircraft has just landed in Toulouse today.

KarelXWB · Tue Oct 17, 2017 7:45 am

The CS300 prototype has just arrived at the Airbus delivery centre. I guess there wil be a lot to celebrate today.

Growing market for C Series results in second Final Assembly Line in Mobile, Alabama, serving U.S. customers

And that's how Bombardier will avoid the 300% tariff.

Airbus-Bombardier CSeries deal means no tariffs on US-assembled aircraft, says CEO

Flip side of the coin is that CS500 may never see daylight.

VirginFlyer · Tue Oct 17, 2017 7:46 am

DeanBNE wrote:
No more A318NEO

There never was an A318neo.

V/F

Mortyman · Tue Oct 17, 2017 7:48 am

A Boeing spokesman dismissed the agreement as a “questionable deal between two state-subsidized competitors” to try to skirt a recent U.S. trade finding against the CSeries.

http://www.reuters.com/article/us-bomba ... SKBN1CL328

Who is online

Popular Searches On Airliners.net