Bombardier turns its focus to 90/100-seater

 - December 6, 2007, 7:05 AM

It took a while for the message to register, but Bombardier finally heeded the airline market’s counsel in late January and shelved its languishing C Series program. Although it will retain a staff of about 50 for studies on a small mainline jet, the company has begun shifting most of the financial and human resources once dedicated to the C Series to other programs, most notably studies on a new 90- to 100-seat regional jet. It has also begun looking into a possible stretch of the 86-seat CRJ900, labeled internally the CRJ900X, along with a longer variant of the 78-seat Q400 turboprop.

Although the announcement doesn’t necessarily spell the end of the C Series, it does erase any ambiguity about Bombardier’s desire to mount a stronger challenge to Embraer in the upper reaches of the regional aircraft market. By the start of the year the Brazilian manufacturer carried a backlog of some 367 commercial jets, including 208 Embraer 190s and 195s–airplanes that occupy the very capacity segment from which Bombardier remains conspicuously absent.

Bombardier, meanwhile, now builds only six regional jets per month after suspending production of the 50-seat CRJ200 in November. After signing a deal in late January for three CRJ900s from Turkey’s AtlasJet, its firm order backlog stood at 109 CRJ700/900s as of the start of last month. Fortunately for the Canadian company, a resurgent turboprop market has increased the backlog for its Q Series line to 90, raising spirits at the Toronto assembly facility and maintaining a respectable revenue stream within the regional aircraft division.

During a January 30 teleconference from Montreal, Bombardier Aerospace president and COO Pierre Beaudoin acknowledged that the company has set its sights on the segment now covered exclusively by the 100-seat Embraer 190. He offered few details about what form the regional jet project might take, however, and did not place a definitive time frame on its completion. He spoke in similarly vague terms about plans for a new turboprop, saying only that it would hold between 80 and 100 seats.

“What we will be looking at is like we’ve done in the past–strike a right balance between comfort and economics, and it’s too early to tell you exactly which will be our strategy…those are the discussions we will have with our customers over the next few months,” said Beaudoin.

A stretch of the CRJ900, the CRJ900X could conceivably carry four more rows of seats, raising standard capacity from 86 to 94 passengers. A four-row stretch of the 70-seat CRJ700, which itself uses the same fuselage cross-section as the 50-seater, the CRJ900 already has tested the practical limits of a tube originally designed for a business jet.

Few outside Bombardier would disagree that, although the new Embraer 190 has recently suffered its share of “teething pains” with JetBlue Airways, the E-Jet line’s larger, more comfortable cabin has contributed mightily to its early sales success.

Nevertheless, the CRJ900 has earned raves from Mesa Air Group CEO Jonathan Ornstein, who has called it by far the most economical jet in the regional business. A derivative design would also take less time to develop, perhaps allowing Bombardier to join the race, albeit belatedly, before the market starts to saturate. If, as Beaudoin said, Bombardier’s inability to certify the C Series before 2010 ultimately led to the program suspension, it stands to reason that a new regional jet would face no less time pressure.

“The plan’s initial delivery date of 2010 was too far out in the future for some customers, and without program launch, that date was becoming increasingly difficult to meet,” conceded Beaudoin in reference to the C Series. “We could not make a launch decision, and at the same time to hold the date of 2010 we would have to start investing much more than $10 million a month to increase the design team.”

Not the End for the C Series
Bombardier has spent some $100 million on the C Series since work began more than a year-and-a-half ago. Under a new R&D budget, scaled-back program studies will consume no more than $20 million over the next year. Bombardier president of commercial airplanes Gary Scott, hired specifically to shepherd the program through the certification process, will continue to lead the 50-member team left behind from the original C Series staff of 350. According to Beaudoin, Scott and his team “will further develop the C Series business plan by exploring new partnerships, especially in the high-growth international market.”

Beaudoin confirmed that Bombardier has spoken with executives from Russia’s Sukhoi about some form of collaboration, but he wouldn’t elaborate on the substance of the talks. “We’re having discussions with different partners around the world, especially focused in potentially large markets such as India, Russia and China,” he said. “We have had discussions with Sukhoi as we have with many other potential partners.”

Whether those partnerships take the form of Russian or Chinese participation in some iteration of C Series airplane, for example, or Bombardier participation in the Russian Regional Jet or ARJ21 remained unclear. Beaudoin would guarantee only that Bombardier will keep its options open. “Our commitment to the upper end of the regional aircraft market and the lower end of the mainline market remains strong, and we expect to fully exploit opportunities in those two markets in the future,” he said.

Either way, it appears C Series engine partner Pratt & Whitney Canada will play a key role. “Once we have finalized the project for regional jets we will undertake, Pratt will be part of this,” said Beaudoin.