Delta’s CSeries snub not a setback: Bombardier
Sept. 15, 2011, Montreal - Bombardier continues to hope it will win orders from Delta Air Lines despite the U.S. carrier's announcement it will not buy mid-sized planes such as the CSeries in the "near to medium term.''
September 15, 2011 By The Canadian Press
Delta extinguished expectations by telling an industry conference that it won't place a second aircraft order for 100 mid-size planes following its decision last month to buy 100 Boeing 737-900ERs for US$8.5 billion.
"Delta is one of Bombardier's longest and most loyal customers, so we have every confidence that relationship will continue to flourish with new aircraft orders,'' Bombardier spokesman John Arnone said in an email.
The Montreal-based manufacturer wouldn't indicate which planes it now hopes to sell to Delta.
Chris Murray of PI Financial Corp. said Delta affiliates could still order CRJ regional jets while the mainline carrier defers its decision about the CSeries for a couple of years.
"(I'm) still looking for continued small orders from a variety of customers on the ramp up to production, not a 'major' order that would overshadow the order book at this point,'' Murray said in an email.
Industry observers had expected Delta would order the new 110- to 149-seat CSeries plane after the airline previously said it was looking to buy up to 200 aircraft to replace its aging fleet.
But Delta president Ed Bastian threw cold water on those hopes Tuesday at the Deutsche Bank Aviation and Transportation conference.
"We are done talking about aircraft for the near to medium term,'' he said.
Despite "industry chatter'' about another round of aircraft orders, he said "there's no second step of aircraft whether it be with Bombardier or Embraer or Boeing or Airbus.''
"We're very comfortable with where we will be sitting for the next several years. I do want to put to rest any thought that we are in the market considering a new aircraft decision.''
The carrier wants to cap its annual capital expenditures at US$1.2 billion to US$1.4 billion, Bastian added.
Analysts said a Delta order for the CSeries would have increased investor confidence in the program, set to enter into service the end of 2013.
On the Toronto Stock Exchange, Bombardier shares briefly hit a new 52-week low. They fell five cents at $4.21 in afternoon trading.