3,000 Jobs To Be Eliminated Worldwide By End Of 2009

A reduction in the number of expected deliveries in 2009 plus an excess of used aircraft on the market have combined to make tough times for Bombardier, spurring last week's announcement of the planned elimination of 3,000 more jobs by the end of this year, in addition to 1,360 positions cut in February.

This round of job cuts will affect workers in factories in Canada, Northern Ireland, Mexico, and the US. The layoffs are a result of a projected 25 percent decrease in demand for the company's Learjet and Challenger aircraft, likely to effect a sharp contrast to the record-breaking $1 billion in profits achieved by Bombardier during the last fiscal year.

Guy Hachey, president and CEO of Bombardier Aerospace, told the Toronto Star the company is prepared to make more cuts if economic conditions worsen. "This is the kind of market we're in," Hachey said. Sales are expected to remain slow until economic conditions improve.

"These decisions were very difficult to take but they were necessary to (put) the company in a viable position in the present environment and align production to the reduced market demand," Hachey said.

In a recent report, industry analyst Cam Doerksen of Versant Partners said Bombardier's plan to cut production is a realistic solution to today' marketplace. "This new guidance is precisely in line with our existing forecast and a more realistic target," Doerksen said.

Despite the sound business logic, Roland Kiehne, president of Local 112 of the Canadian Auto Workers union, raised practical concerns. "We knew sooner or later the global financial crisis would have an impact on the business jet sector," said Kiehne. "We've been hollering at the federal government for years, demanding they reinvest public funds back into the Canadian economy to protect workers from economic downturns, just as we're seeing today.

"Now, more than ever, we need the government to show support for our domestic aerospace industry, and help save jobs at our Bombardier plant," Kiehne said. "Where are these young workers going to be able to apply these skills when there are no jobs in the manufacturing sector? It's devastating for young families."

FMI: www.bombardier.com, www.caw112.on.ca