MONTREAL (AFP) – Canadian aircraft and transport company Bombardier will cut 5,000 jobs globally and sell off its aging turboprop line in a bid to ”streamline” operations, the struggling firm announced Thursday.
The seven percent reduction of its workforce across the organization will occur over the next 12 to 18 months, while key aerospace engineering team members will be redeployed to its booming business jet segment.
The cuts will be concentrated in the aerospace business and will affect 3,000 workers in Canada, company spokesman Simon Letendre told AFP. Bombardier has had to slash more than 15,000 jobs in its aerospace and rail divisions around the world since 2015.
The Montreal-based group also announced the sale of ”non-core assets” totaling around US$900 million, including the Q Series medium range turboprop aircraft program and the de Havilland trademark, which was sold for some $300 million to a Canadian investment fund.
Flight simulator and training firm CAE, meanwhile, has agreed to pick up Bombardier’s business aircraft flight training segment, which is forecast to generate royalties of $800 million.
The restructuring announcement came as the company reported net income of $167 million in the third quarter, compared with a loss of $11 million a year earlier.
”We continue to make solid progress executing our turnaround plan,” Bombardier chief Alain Bellemare said of the restructuring effort.
”With today’s announcements, we have set in motion the next round of actions necessary to unleash the full potential of the Bombardier portfolio,” he said in a statement, adding that the firm ”will continue to be proactive in focusing and streamlining the organization.”
Speaking to analysts in a conference call, Bellemare was upbeat about the company’s prospects.
”We’re going through a major turnaround,” he said. ”And by and large, if you look at what we’ve done so far we positioned the company very well for the next phase.”
Renaud Gagne of Unifor, the union representing Canadian aerospace workers, however, warned that the layoffs ”send a worrisome message for the future of the industry.”
The decision to sell the Q Series line, Bellemare said, was made ”because we believe there is a better owner than us to keep this program going.”
He said he hoped ”to see more movement from suppliers to reduce costs” on its other regional aircraft line, the CRJ, noting that Bombardier continues to lose money on its manufacturing.
CRJ series and Q400 deliveries for the quarter had totaled only five aircraft, while net orders totaled 11.