Bombardier has begun the temporary shutdown of its business-jet production lines as it implements urgent cost-cutting measures announced last month. Challenger production in Montreal is being slowed for four months, and Global Express assembly in Toronto will be halted for up to eight weeks beginning in mid-November. A four-month shutdown of Learjet production at Wichita, Kansas, will begin on 1 December.
The production cut follows Bombardier's announce-ment that it will deliver only 100 business jets in the financial year ending 31 January, down from the 140 originally planned, because of the dramatic slump in the corporate aircraft market. The cost-cutting measures, which include almost 2,000 layoffs, are expected to save C$200 million ($125 million) a year, but stopping and restarting the production lines will incur a one-time cost of C$45 million, Bombardier says.
The production hiatus will avoid a build-up in unsold "white tails", the company says. "We had an urgent requirement to cut the rates. It will allow us to see how the market develops over the next four to five months and help us decide how best to bring the lines back up again." Development and entry-into-service schedules for the Challenger 300, Global 5000, and Learjet 40 and 45XR will not be affected by the measures, the company says.
Bombardier's action is the most dramatic by a business jet manufacturer. Raytheon has scaled back Beechcraft and Hawker output substantially, Gulfstream has slowed GIV and GV production and Cessna has lowered its Citation delivery forecast for next year as it works off its order backlog. Dassault, however, plans to continue Falcon production at around 75 a year for the next two years, citing a strong backlog.
Source: Flight International
