Johannes Eisele Agence France-Presse
Bombardier has not disclosed in what facilities will be held the dismissals, limiting themselves to say that the cuts, half of which is expected as early as the next few weeks, will take place both in manufacturing and administration. In the photograph, a Global 6000 aircraft, including the interior finishing is done in Dorval.
Between the challenges of social distancing, and the costs of these devices, what will the demand be for the business aircraft once the crisis is over ? Bombardier hope she will come back, but a month after it warned that the industry would see its shipments plunge by about 30 % compared to what was previously expected, the company believes that it is necessary to remove the 2500 posts by the end of the year to adjust to the new reality of the market. The government of Quebec does not preclude a further aid, accompanied, however, conditions concerning the maintenance of jobs and the salaries of senior executives.
Of the 2,500 jobs, 1500 is located in Quebec, where the company assembles its Challenger and the interior finish of the luxury Global. Bombardier has not disclosed in what facilities will be held the dismissals, limiting themselves to say that the cuts, half of which is expected as early as the next few weeks, will take place both in manufacturing and administration. For the rest, 400 layoffs are planned in Ontario, the place of assembly of the Overall, compared to 500 in Mexico and a quarantine in the United States.
“It is very regrettable to have to resort to these reductions. However, we have reached the maximum of our ability to maintain our employment levels before the crisis of the COVID-19 “, wrote the president of the Aviation division, Bombardier’s David Coleal, in an internal note to staff. Bombardier Aviation has 22 000 employees worldwide, of which 10,000 are in Quebec.
Bombardier has suspended its manufacturing activities at the beginning of the pandemic and then resume gradually. “Now, with the decline in projected deliveries of business aircraft in the industry as a whole of approximately 30 % over 12 months due to the pandemic,” said the company in its official press release, it is necessary ” to adjust activities and workforce to ensure we emerge from the current crisis on solid foundations.” To employees, Mr. Coleal noted that ” if the market improves, we will assess the measures to reintegrate with our colleagues “.
This is the number of positions that Bombardier has to remove them from here to the end of the year to adjust to the new reality of the market.
To shift to Sherbrooke, the prime minister François Legault has not closed the door to a new aid to the company, taking advantage of a question from the press to criticize the funding of the liberal Party in 2015. At the time, it had been agreed to inject US $1 billion in the program, C Series, and not in the parent company as such. There were ” no guarantees “, he said, neither on employment nor on “wages and bonuses” paid to the management. “If we were to invest, it would make sure not to repeat this error here. “
Bombardier is qualified for the wage Subsidy emergency of Canada (SSUC), which covers up to 847 $ per week per employee. For the company, this program will end on 6 June. The Machinists ‘union accuses Bombardier of you have not tried to renew their eligibility to go beyond this date and considers “incomprehensible” the announcement of layoffs.
“On the 27th of last may, we communicated with Bombardier for the invite to formulate a new request. We understand that the company did not intend to go in that direction, ” according to the union. “As of today’s date, we are not certain that we qualify for the following stages “, responded in an interview to a spokesman, Mark Masluch.
What request ?
As at 31 march, the backlog of Bombardier for the business aircraft was $ 13.6 billion, down 6 % compared to 2019. The company has delivered 26 aircraft in the first three months of the year, two more than in the same period last year. Bombardier said Friday that the layoffs will be accompanied by a charge of $ 40 million in its books of 2020.
“The sinews of war, it’s going to be the deliveries in the short term, because this is what will allow the input of financial flows. As soon as it resumes, we can be optimistic about the result, ” said Yan Cimon, professor of strategy at the Université Laval and past director of the interuniversity research Center on enterprise networks, logistics and transportation. “But it is absolutely sure that this time, they do not have the option to review the geometry of their operations to make it through. It is truly unfortunate, because it is a critical sector for Quebec and Canada. “
In general, among the issues that will influence the evolution of the sector include the issues of cost, social and environmental responsibility of companies and clients. “It remains that it will still remain a tool of choice for a niche in the world of business and wealthy individuals,” said Mr. Cimon.