Move Made Public In 2015 Financial Report

In a move Bombardier calls a "workforce optimization", the company will cut 7,000 jobs from its operation.

The announcement came in the company's report of 2015 financial results.

"As the company evolves over the next two years, its global workforce will be reduced by a targeted 7,000 production and non-production employees, including 2,000 contractors," the report says. "This reduction will be partially offset by hiring in certain growth areas, notably to support the ramp-up of strategic programs and projects worldwide, such as the C Series. These adjustments will enable Bombardier to resize its organization in line with current business needs and to increase its competitiveness."

The company said the decision to optimize the organization is based on an in-depth review of the company carried out over the past year:

• As previously communicated, production rates have been modified for some aircraft models due to macroeconomic conditions. As a result, Bombardier is adapting its workforce to meet market demand.
• Major aerospace development programs and projects at Transportation, which mobilized numerous employees, are ramping down as expected. Bombardier is resizing its manpower to match future workloads.
• Finally, the company’s transformation plan is taking hold, driving productivity across the entire organization.

But Bombardier said it intends to hire in certain growth areas:

• The C Series aircraft program continues to ramp up its production rate and to win orders, generating new jobs at the Bombardier facility in Mirabel, Québec. The number of employees directly assigned to the C Series program has increased in the past few months, reaching a total of 3,450 employees worldwide, and is expected to keep growing over the next few years.
• In addition, Bombardier Transportation's impressive $30.4-billion backlog includes certain large orders which will mobilize additional manpower in regions where it has a limited presence.

“Throughout 2016 and 2017, we will adapt our global manpower to current market conditions, while hiring to support growing segments, such as the C Series,” said Mr. Bellemare. “These adjustments are always difficult. They are important to ensure that, with our 64,000 employees worldwide, we continue to create superior value for our customers, be more competitive, and deliver improved financial performance,” he added.

Impacted positions are mostly based in Canada and Europe, where the company’s aerospace and rail transportation activities are concentrated. Bombardier will support affected employees and will provide them with resources to help them manage through their transition.

The reductions will begin in the coming weeks and will be implemented over a period of two years. Throughout 2016, on a full year basis, Bombardier expects to record $250 million to $300 million in restructuring charges that will be reported as special items when accrued.

“We are turning Bombardier around to make this great company stronger and more competitive,” said Alain Bellemare, President and Chief Executive Officer. “Over the past year, we renewed our leadership team and developed a clear plan to significantly improve our performance. We de-risked major development programs and stabilized the company, securing our liquidity position and taking a series of actions to rebuild margins.”

FMI: Report