Canadian business jets maker, Bombardier, has announced plans to reduce its worldwide workforce by 2,500 people within its aviation division.
Montreal news reports that the cuts will see 1,500 layoffs in Quebec, 400 in Ontario, 500 in Mexico, 40 in the U.S., and about 60 outside North America.
Therefore, the company is looking to book a $40 million charge related to the job cuts even as it expects business jet deliveries to be down 30% industry-wide.
The business aircraft segment had initially expected double-digit revenue growth this year with 160 unit sales in 2020 amid a $16.3-billion backlog and had begun to ramp up production when the pandemic hit in March.
Bombardier is a Canadian multinational manufacturer of business jets and rail, with its headquarters in Montréal, Canada. It manufactures several series of corporate jets: Global 7500, Global Express, Challenger 600, Challenger 300, and Learjet 70/75. The company has production and engineering sites in over 25 countries across the segments of Aviation and Transportation. Its shares are traded on the Toronto Stock Exchange.
In the fiscal year ended 31st December 2019, Bombardier posted revenues of $15.8 billion.
Currently, the company is in the process of selling its rail business to French train maker, Alstom, for up to $7.02 billion. The deal is now undergoing regulatory scrutiny in the European Union.
The job cuts come barely a week after Mitsubishi Heavy Industries (MHI) completed the acquisition of Bombardier’s CRJ Series regional jet. The purchase cost Mitsubishi a cash consideration of close to $550 million.
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