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Business Aviation Has Prominent Role in Bombardier Growth Strategy

 - February 1, 2018, 10:00 PM
The Global 7000 inspired the Premier cabin interior for the Global 5000/6000, pictured.

Bombardier's multi-year growth plan places significant emphasis on its Business Aircraft (BBA) division, with introduction of the Global 7000 and continued ramp-up of its aftermarket business the primary BBA contributors.

The company is in the midst of a five-year turnaround plan that has set a target of $20 billion in revenue in 2020, up from $16.3 billion in 2016. Current projections expect BBA—which generates about $5 billion annually, second only to Bombardier's rail-focused Transportation business—to grow to $8.5 billion. This year's expected addition of the Global 7000 to its in-service portfolio will give Bombardier a deep lineup, just as the business-aircraft market is turning around, company executives say.

"At BBA, if you want to buy a legend, you buy a Lear. If you want the best value and utility in business jets, buy a Challenger," said Bombardier CFO John Di Bert. "If you want performance, comfort, and range, there is nothing better than a [Global 5000/6000]. And soon, if you want to have the best business jet anywhere in the world, the Global 7000 is going to be here."

As the newest addition to the family approaches entry into service, the existing lineup continues to shine. 

The Challenger family recorded two notable delivery milestones in the second half of 2017. The super-midsize Challenger 350 surpassed 200 deliveries, and the more recently introduced large-cabin Challenger 650 passed the 50-delivery mark.

Bombardier also unveiled a new Premier cabin interior for its Global 5000 and 6000. The changes borrow extensively from the 7000's cabin design—part of the company's effort to create a common look across the Global family.

Bombardier is projecting 135 deliveries in 2018, which would match 2017's total. But the major difference between last year's and this year's delivery inventory will be the 7000's presence. Bombardier is on track to certify and deliver the first 7000s later this year, and says production for the newest model is sold out through 2021.

The company's push to grow its 7000 backlog continued with the Middle East debut of its full-scale cabin mock-up. The mock-up went on display at the Jetex Private Terminal in Dubai in mid-January and is scheduled to be there for about a month. It is the first time the mock-up, unveiled in 2014, has been displayed in the Middle East.

Service Network

As its in-service fleet grows and expands, Bombardier is increasing its focus on caring for it. Last year it opened service centers in Tianjin, China, and at London's Biggin Hill Airport. Bombardier soon after announced plans to double capacity at Biggin Hill with a hangar that will be dedicated to heavy-maintenance events, including 96-and 120-month inspections.

The new facilities expand a global network that now includes six line maintenance stations, 23 Customer Response Team mobile units, and some 60 service centers, including nine OEM facilities. The network both provides options for Bombardier's customers and gives the company valuable exposure to its customers' aircraft.

"At any given day and time during our fiscal year, we can have 150 aircraft in our service centers," said BBA president David Coleal. "We will touch over 1,000 customer aircraft through the course of a year."

It's with this in mind that Bombardier has been ramping up the offerings it has for its customers. The business jet division rolled out more than 30 aftermarket products and services in 2017, ranging from online portals for tracking work on aircraft to new connectivity options. Among the notable introductions: its new Smart Services cost-per-flight-hour offering.

Unveiled this past October, Smart Services builds on Bombardier's pioneering Smart Parts program, which was introduced in 1986. The new Smart Services integrates operator feedback and expands offerings to a broader set of potential customers. It is available to both entry-into-service customers and all existing Bombardier business jet operators’ aircraft with up to 20 years of service.

“We intentionally designed this offering to be fully flexible and bespoke, based on feedback from our customers," said Jean-Christophe Gallagher, BBA vice president and general manager, Customer Experience.

The new service centers and expanded parts program are part of a concentrated effort to increase aftermarket revenues, said Coleal.

"We've also invested in our service network, giving capabilities such as interior modifications in avionics and paint, along with adding products and services that only we as an OEM can do from an IP perspective and also from an OEM design capability," he explained. "All of that has led to double-digit revenue growth within the fiscal year of 2017, which we're very pleased with."