Bombardier Inc. has announced the sale of its Canadair Regional Jet aircraft programme to Mitsubishi Heavy Industries (MHI) on Tuesday. Production of the aircraft type will end in 2020.
Mitsubishi will take over all assets connected to the CRJ sale, production, maintenance and services. This will also include the type certificate of the aircraft family, along with its support network located in Montréal and Toronto, along with its service centres located in Bridgeport, West Virginia, and Tucson, Arizona.
The deal is valued at US$750 million in total, of which MHI will pay US$550 million in cash upon closing of the deal with Bombardier Inc. in the first half of 2020, along with taking on debt of US$200 million.
Mitsubishi is pushing hard to get into the commercial aviation business and is in the process of getting its newly developed M90 ‘Spacejet’ regional aircraft on the market. It’s suffered a number of delays and technical issues – all the way to a fundamental redesign of some parts of the aircraft systems.
In combination with our existing infrastructure and resources in Japan, Canada and elsewhere, we are confident that this represents one effective strategy that will contribute to the future success of the Mitsubishi SpaceJet family. MHI has a decades-long history in Canada, and I hope this transaction will result in the expansion of our presence in the country, and will represent a significant step in our growth strategy. Seiji Izumisawa, President & CEO of Mitsubishi Heavy Industries
It’s quite a sad day in many respects as the whole CRJ programme is going to shut down by the end of next year. No new orders will be accepted and only current ones will be fulfilled.
The facility in Mirabel, Canada will remain with Bombardier and will continue to supply components and spare parts after CRJ production ends.
Bombardier has in effect sold out its CRJ programme – it can’t afford to develop any new aircraft, and left the space to Mitsubishi for their new regional aircraft. In turn they’ve gotten rid of the only real competition.
Bombardier sold off the Dash-8 programme to Canadian Longview Aviation Capital Corp in November 2018 who operate it under the original DeHavilland name, and the straw that broke the company’s back financially, the CSeries was sold off to Airbus as the A220 in August 2017.
Bombardier Inc. is now left with just its railways and business jet operations.