Lessors Buoy Bombardier’s Sales Aspirations
Encouraged by last year’s successful effort to secure three European lessors for 10 Air Nostrum CRJ1000s, Bombardier expects the trend toward more lease acquisitions of regional airliners to continue. For the Canadian airframer, attracting lessors will prove vital to the success of the new C Series as well, and perhaps most notably in China, where aircraft leasing remains a relatively new option.
“I do think we’re seeing a trend and a shift where some of the lessors are trying to find assets that might give them a differentiator,” Mairead Lavery, Bombardier’s vice president of strategy, business development and structured finance, told AIN during the 32nd Annual Airfinance Conference in New York City on April 23. “So that could be regional jets, which we saw last year. We’re seeing really renewed interest in the turboprop from lessors. And I think we’re also seeing new lessors come to the table and those lessors are not necessarily geographically-centric in North America.”
In February, Bombardier signed a landmark MOU with China’s Avic Leasing to collaborate on financing “solutions” in China and elsewhere. “It was very important to go out at the outset and really ensure that the C Series was well understood by financiers and had a number of financing sources behind it,” added Lavery.
Meanwhile, Bombardier also recognizes the vital role export credit agencies such as the Chinese ExIm Bank play, hence much of the benefit it derives from the Chinese content in the C Series, namely the aluminum-lithium fuselage built by Shenyang Aircraft. “So we’re fortunate that we have content in China, we have content in the UK, we have content in Canada and we have significant U.S. content,” said Lavery. “It would be nice to think we could go down the path of Airbus and have a conglomerate of our export credit agencies supporting the product.”
Notwithstanding some skeptics’ calls for a deeper order base, Lavery expressed satisfaction with the airplane’s sales performance. Holding firm orders for 138 airplanes and total “commitments” for 317, Bombardier has seen its production skyline for the C Series extend to two-and-a-half years, and it feels no pressure to lower its asking price, Lavery told AIN.
“Despite everyone wanting to see a large order, for us it’s more important that we get a number of customers operating the aircraft—different types of customers [such as] low-cost carriers, lessors, mainline airlines, [operators offering] more specialized types of service,” she said. “So it’s hugely important that we have that diversification of the customer base.”