(Adds job cuts, analyst comment, background on previous
By Euan Rocha and Allison Martell
TORONTO, July 23 Struggling with long delays in
its CSeries jetliner, aircraft maker Bombardier Inc on
Wednesday announced it will reorganize its business structure
and cut 1,800 jobs, and it said the head of its aerospace
division would retire.
The Montreal-based company is splitting its aerospace unit
into three segments focused on business aircraft, commercial
aircraft and aerostructures and engineering services.
The three units, along with Bombardier's rail-industry
focused transportation unit, will all have separate heads
reporting directly to Chief Executive Officer Pierre Beaudoin.
As part of the moves, Bombardier Aerospace President and
Chief Operating Officer Guy Hachey will retire.
His retirement is the latest senior departure from the
CSeries program. Last year, Bombardier replaced Chet Fuller,
head salesman for the CSeries. Gary Scott, head of Bombardier's
commercial plane unit and a champion of the CSeries program,
retired in 2011.
"Stability is important for an aircraft program, and they
haven't been very good at all about stability," said aerospace
analyst Richard Aboulafia of Virginia-based Teal Group.
The revamp means 1,800 aerospace jobs would be eliminated,
Bombardier spokeswoman Isabelle Rondeau said. Bombardier had
76,400 employees at the end of 2013 of which 37,400 worked in
the aerospace division, she said.
The job cuts are in addition to reductions announced in
January, when Bombardier said it would cut 1,700 aerospace jobs.
The company has been pushing to preserve cash after costly
setbacks in the development of the CSeries.
Wednesday's shakeup comes as Bombardier continues to work on
the issues that have stymied the CSeries program.
The new jet family is meant to crack the 100- to 149-seat
market and pits the company against industry giants Boeing Co
and Airbus. Bombardier has touted the CSeries
jet's superior fuel and operating efficiency but has faced a
number of obstacles and delays, including an engine failure that
grounded its test aircraft in May.
"The new aerospace organizational structure will enable us
to be more agile and flexible in addressing customer needs,
while increasing our focus on growth areas," Beaudoin said in a
The company said the new structure will be in place Jan. 1.
Hachey has been high-profile in promoting the CSeries
program, speaking with media and appearing at airshows,
including the Farnborough International Airshow in England that
ended last week.
Bombardier surprised many analysts and investors by securing
a sizable number of orders for the CSeries at Farnborough,
despite the aircraft not making an appearance at the airshow.
The company said its new aerostructures and engineering unit
will specialize in the design and development of composite and
metallic aerostructures in all classes of civil aircraft and all
categories of structure, including fuselages and wings.
(Additional reporting by Solarina Ho in Toronto and Kanika
Sikka in Bangalore; Editing by Sriraj Kalluvila, Lisa Shumaker,
Amran Abocar and Cynthia Osterman)