Wednesday, May 20, 2015

Bombardier sheds 1750 workers plus one executive

Eric Martel, president of the business-aircraft division of Bombardier is leaving his position less than two years after he was appointed. He will be replaced by David Coleal who had been vice-president and general manager of Spirit Aerosystems.
Although only head of the business aircraft division for two years, Martel had been with the company both in the Aerospace and Transportation units for 13 years. He said that he would pursue other career opportunities. The business jet division has fallen on hard times. Russian oligarchs in particular are short of cash and subject to sanctions. Sanctions against Russia caused Bombardier problems last year in March:Canadian aircraft manufacturer Bombardier faces $3.4 billion in lost potential sales to Russia as Canada and its allies impose sanctions over the former Soviet state's move to annex Crimea, reports said Friday.
As a result of slowing demand for Bombardier's Global 5000/6000 business jets the company is slashing 1,750 jobs in its aerospace division. Almost 1,000 of the jobs lost will be in Montreal a big blow to the city and the province of Quebec. 480 jobs will be lost in Toronto, and 280 in Belfast, Northern Ireland. The company is going to reduce production of the business jets. CEOAlain Bellemaire said:"We recognize there are a lot of challenges ahead us of but we are taking firm, clear and quick actions to improve the situation." Bellemaire is part of the new management that is trying to turn the company around. The cuts are expected to save Boombardier about $183 million a year. Bellemaire took over the top job this February. The company has also hired Jean-Paul Pelissier a procurement expert to do a review of the company's supply chain. Over the longer term Bombardier expects strong demand for its business jets. It expects to 210 of the jets this year.
Bombardier is having problems with vehicles being provided for the Toronto Transportation Company(TTC). TTC CEO Andy Byford said:The first of the 204 new streetcars — price tag: $1.2 billion — were so flawed that the TTC simply couldn’t risk putting them into service because they would almost certainly break down on Toronto streets, he said. Parts produced in Mexico were so poorly made that they couldn’t be properly assembled in Bombardier’s Thunder Bay plant, where attempts to rivet badly cut walls and under-frames were rejected by the TTC. Byford also cited defective laminate, loose screws and faulty electrical connectors among the issues on the new TTC vehicles.Provincial agency Metrolinx has also placed a $770 million dollar order but the vehicles are a year behind on delivery. Metrolinx is encountering similar problems with their vehicles as is the TTC with the vehicles being assembled in Mexico. Metrolinx says that it is working closely with Bombardier management who are taking corrective action in Mexico.

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