Bombardier CEO Beaudoin remains optimistic
Jan. 22, 2015, Davos, Sui. - The head of embattled transportation manufacturer Bombardier says he does not intend to panic in the face of a plummeting of the company's shares since last week when it reduced its financial forecasts and announced 1,000 job cuts.
January 22, 2015 By The Canadian Press
At the World Economic Forum in Davos, Switzerland, Pierre Beaudoin said he understands the concerns of analysts and investors but insisted that the Montreal-based aerospace and rail equipment maker is focused on the long-term, with revenues from new development programs including the CSeries commercial passenger jet about to begin rolling in.
Bombardier’s shares have plunged to near a six-year low since it announced last week that it was putting development of its Learjet 85 business jet on hold. That raised concerns about whether it has enough cash for its key aerospace development programs — the CSeries set for delivery later this year and the Global 7000/8000 business jet.
The shares have lost 30 per cent of their value in less than a week, but were up 12 cents or 4.3 per cent at $2.92 in Wednesday morning trading on the Toronto Stock Exchange.
Several analysts say management’s credibility has taken a hit and it has run out of excuses about not being able to meet its own financial forecasts despite restructuring its aerospace division last summer and proceeding with waves of job cuts that trimmed its overall workforce by 2,900 last year.
For Beaudoin, a member of the family that effectively controls the company through its stock holdings, the changes are simply part of the “challenge…to establish a long-term vision.”
Without commenting directly on the stock movement, the grandson of Bombardier’s founder said the company’s order backlog which exceeds US $70 billion, including nearly half in its railway division, should help to reassure investors.
Beaudoin said he planned to take advantage of his visit to Switzerland to set the record straight with clients, airlines and banks that do business with the Canadian company.
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