February 13, 2009 / 3:59 PM / in 9 years

UPDATE 3-Bombardier Q400 planes have had few prior problems

* Bombardier Q400 turboprop crashes near Buffalo, N.Y.

* First fatal crash involving a Q400 turboprop

* 220 of the planes have been delivered around the world

* Company banking on strong Q400 sales in 2009

* Shares down 6.5 percent on TSX (Adds comments from spokesman, insurance information, updates stock price)

By John McCrank

TORONTO, Feb 13 (Reuters) - Canadian plane maker Bombardier Inc (BBDb.TO) said on Friday the crash of one of its Dash 8 Q400 turboprop aircraft near Buffalo, New York, on Thursday night, which killed 50 people, was the first fatal crash involving that type of plane, although it has had some safety problems.

A spokesman for Bombardier said 220 of the Q400 turboprops have been delivered to 30 airlines around the world.

Over nine years of flights, the fleet had logged more than 1 million flying hours and 1.5 million takeoff cycles without a fatal accident, said Bombardier spokesman John Arnone.

The plane in the Buffalo crash was just under a year old.

The company said it has sent a product safety and technical team to the crash site to help with the investigation.

“We have singularly set for ourselves a priority, which is to deal with this tragic accident and to deal with it the best that we can by assisting the (National Transportation Safety Board) where and if required,” Arnone said.

Pratt & Whitney Canada, the maker of the engine for the plane, also sent officials to the site, a spokeswoman said.

The cause of the crash was unknown.

“There have been a few crashes with the Dash 8 over the years, but I don’t recall anything that has been noticeably pointed out in the literature about that particular airplane that would suggest any issues,” said David Greatrix, professor of aerospace at Ryerson University in Toronto.

Three made-in-Toronto Dash 8 Q-400 planes, owned by airline SAS (SAS.ST), were involved in crash landings in Scandinavia in a span of 45 days in the fall of 2007 due to problems with landing gear.

SAS later pulled its 27-strong fleet of Q400s out of service at a cost of hundreds of millions of Swedish crowns.

SAS said in March of last year it had agreed with Bombardier and landing gear maker Goodrich Corp GR.N on compensation for the problems. The details were confidential, but SAS had said it would receive total compensation of “slightly more than 1 billion Swedish crowns” ($120 million) in cash payment and credits for future aircraft orders.


    Montreal-based Bombardier said last week it would lay off 1,360 people due to the downturn in the business jet market. It said that softness could be offset by an expected 10 percent rise in orders for commercial aircraft, led by an increase in demand for the Q400 turboprop.

    Richard Stoneman, an analyst Dundee Securities, said he does not expect Bombardier sales to suffer as a result of Thursday’s crash.

    “I can’t think of any other aircraft where sales have been adversely affected by incidents of this type,” he said.

    The company said earlier this week that it had finalized terms with Colgan Air, the airline that operated the plane that crashed on Thursday, on an option to buy another 15 Q400 NextGen turboprop airliners.

    That was on top of 15 firm Colgan orders, worth $432 million, announced in January for the fuel-efficient, low emission, 70- to 80-seat turboprop airliner.

    Colgan Air is a subsidiary of Pinnacle Airlines Corp PNCL.O.

    The lead insurer on the Buffalo flight was United States Aircraft Insurance Group (USAIG), an aviation pool that includes a unit of ACE Ltd ACE.N, Berkshire Hathaway (BRKa.N) units General Re Corp and Wesco-Financial Insurance Co, and Liberty Mutual, according to British insurance newsletter The Insurance Insider. Calls to USAIG and several of the companies by Reuters were not immediately returned. A spokesman for ACE said the company does not comment on potential claims.

    Bombardier is the world’s third-largest maker of civil aircraft and the world’s biggest maker of rail equipment.

    Its shares have been under pressure lately, dropping more than 20 percent so far this year, as the corporate jet market deteriorates due to the weak economy.

    Shares of Bombardier Inc were down 23 Canadian cents, or 6.5 percent, at C$3.30 on the Toronto Stock Exchange on Friday afternoon.

    $1=$1.24 Canadian Additional reporting by Susan Taylor in Ottawa, Scott Anderson in Toronto, and Lilla Zuill in New York; editing by Peter Galloway

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