Bombardier strikes CSeries deal with lessor Falko Regional Aircraft

TORONTO Sat Jul 12, 2014 5:47pm EDT

A scale model of a CS100 Bombardier airplane is displayed beside a mock-up of the future CSeries Bombardier aircraft at the Bombardier Inc. Montreal offices September 14, 2009.  The planes are scheduled for first deliveries in 2013.  REUTERS/Christinne Muschi

A scale model of a CS100 Bombardier airplane is displayed beside a mock-up of the future CSeries Bombardier aircraft at the Bombardier Inc. Montreal offices September 14, 2009. The planes are scheduled for first deliveries in 2013.

Credit: Reuters/Christinne Muschi

TORONTO (Reuters) - Bombardier Inc (BBDb.TO) said on Saturday that Falko Regional Aircraft Limited, a lessor based in Britain, has signed two letters of intent to buy up to 24 CS100 jets, the first new CSeries deal announced since the first quarter.

The deal comes just as the UK's Farnborough International Airshow officially kicks off on Monday, where expectations have been mixed on whether Bombardier would be announcing any major deals for its brand-new CSeries jetliner. The CSeries is not expected to make an appearance at the world's largest aerospace event.

Bombardier's new jet family is the Canadian planemaker's ticket to cracking a potentially lucrative 100- to 149-seat market and is pitting the company against giants, Boeing Co (BA.N) and Airbus Group (AIR.PA).

But the CSeries, which Bombardier touts as having superior fuel and operating efficiencies, has faced a number of obstacles including multiple delays for the multi-billion dollar program and most recently, engine problems that have grounded the test planes.

Falko Regional Aircraft, which was formed in 2011, has already added Bombardier's regional jet and turboprop to its leasing portfolio.

"As we begin a period of worldwide growth and expansion with a strong pipeline of acquisitions, the CSeries aircraft will figure prominently in our plans. We are confident about its future and positioning in our core marketplace," said Falko's Mark Hughes, executive vice president of corporate finance.

The last commitment for a CSeries was in February, when Abu Dhabi-based Falcon Aviation Services signed a Letter of Intent for one CS300 aircraft and an option for another. Bombardier also disclosed two previously unannounced firm orders in its first quarter results.

The Montreal-based manufacturer says it has booked orders and commitments for 471 CSeries jets, including 203 firm orders. It aims to have 300 firm orders by the time the plane enters into service - currently slated for the second half of 2015.

(Reporting by Solarina Ho; Editing by Marguerita Choy)