Having successfully negotiated a deal where Airbus acquired an 80% stake in the ailing CSeries of Bombardier jets, the Canadian plane and train maker is now in discussion with Mitsubishi Heavy Industries Ltd (Mitsubishi) over the acquisition of its Canadair Regional Jet (CRJ) series according to The Air Current, which also indicated that a firm decision might be announced by the beginning of the Paris Air Show which begins on June 17. As a result of the news, the share price of Bombardier jumped 14 percent.
Mitsubishi has been struggling with its own regional jet, the MRJ. Delivery has been delayed many times since it’s original projected date of 2013 and current revised target of 2020, so the acquisition of the Bombardier CRJ series would provide the Japanese manufacturer with the necessary expertise to assist with development and certification. The timing of the move by Mitsubishi could prove to be prudent with Boeing having recently acquired Brazil’s Embraer commercial jet program which produces jets of a similar size to the CRJ with its E-Jet E2 regional jet.
Currently Bombardier is making a loss on the CRJ program and has no orders for the jet beyond 2020 and has been keen to concentrate more on the profitable business jet and passenger rail car sections of the business.
According to Reuters, Bombardier Chief Executive Alain Bellemare had said in January the company was considering “all strategic options” for the regional jet program, including a potential sale. Analysts have calculated that the value of the sale of the CRJ program would be between the US$300 million Bombardier received from Longview Capital for the sale of the Q400 turboprop and US$680 million based on the delivery of 1,900 of the CRJs to date.
