Bombardier got its very first order of CSeries narrow bodies in the past 18 months but have to cut down the deliveries of the same from 30 to around 20 to 22 due to a delay in the supply of engines. However, this issue with engines is a temporary one and will soon be solved by the supplier Pratt & Whitney, who are actively looking into the matter says Alain Bellemare, the Chief Executive of Bombardier.
Pratt & Whitney is a sub division of the United Technologies Corp and are the producers of the geared turbofan engines which goes into the making of the Airbus A320 Neo and the CSeries. The company claims that they are currently busy solving some issues with the engines that will make the same a more durable version of the already existing one. Bombardier was heard stating that this delay in delivery of engines will ultimately allow their free cash flow to increase to as much as $ 1 billion by the end of 2017 which is at a higher end of the forecast done by them.
This deal of Cseries in Bombardier has shot up the share prices by 4.7% ad are currently trading at C $2.92. The company has also received a letter of intent from an unknown European firm for the delivery of 31 CSeries and Airbus has agreed to pitch in and take majority stakes in the CSeries program for just $1. This will ultimately allow better efficiencies leading to reduced cost of CSeries with an improved sales of the same.
However, Bellemare went on to state to analysts that this new deal and no link with the current CSeries project which will fetch a whopping $2.4 billion according to the current prices of the same along with 30 other options. Analysts are of the opinion that the deal with Airbus which will be closed in 2018 boost the confidence in CSeries while Bellemare is planning to form strategies with the partners to boost the smaller aero structure division which produces CSeries parts.