Bombardier Inc. said it will delay by six months the maiden flight of its CSeries aircraft because it needs more time to develop and test the plane that seeks to push into the lucrative market for single-aisle airliners.
Bombardier, the world’s third-largest maker of commercial aircraft, now expects first flight to take place by the end of June 2013, according to a statement today as the company reported earnings. Bombardier’s CS100, the smaller of the two versions, would probably enter service a year later, it said.
Bombardier joins larger rivals Boeing Co. and Airbus SAS in failing to meet key milestones on new-plane programs. Boeing was more than three years late with its 787 Dreamliner aircraft, having announced a first delay in 2007. Airbus’s A380 jumbo jet was almost three years late in initial deliveries, while its A350-900 model, which won’t test fly until mid-2013, is already running 18 months behind schedule.
“Given what happened with all the other large aircraft programs, and as their schedule was already pretty tight, I think six months isn’t going to be seen as that bad a result,” Zafar Khan, an analyst for Societe Generale, said today in a telephone interview from London. “The challenge is going to be to see if they can deliver within that six-month period.”
Analysts have been tracking the CSeries closely because Montreal-based Bombardier wants the plane to challenge the smallest Boeing and Airbus narrow-body models. Chief Executive Officer Pierre Beaudoin said as recently as mid-October that first flight of the CSeries still could occur in December.
“Substantial headway has been made in the CSeries development program and testing is progressing well,” Beaudoin said in today’s release. “However, some areas require more time. Together with our suppliers, we have now fully harmonized all commitments to the program’s schedule. Therefore, the CS100 aircraft’s first flight will now occur by the end of June 2013 – a timeline that all parties have agreed is achievable.”
Beaudoin said in October that he would still consider the aircraft to be on time, even with a delay of three to five months. Bombardier said that month that it had begun assembling the first-flight vehicle at its Mirabel plant north of Montreal.
Peter Arment, an analyst at Sterne, Agee & Leach in New York, yesterday predicted a delay of at least six months “given the current compressed timeline.”
Bombardier’s widely traded Class B shares rose 1.4 percent to C$3.59 in Canadian yesterday. The stock has lost 12 percent of its value this year. The company announced the delay as it reported a 10 percent increase in third-quarter profit.
Net income climbed to $212 million, or 12 cents a share, from $192 million, or 11 cents, a year earlier. Earnings beat the 11-cent average of 21 analysts’ estimates compiled by Bloomberg. Sales dropped 6.2 percent to $4.34 billion, trailing the average analysts’ estimate of $4.69 billion.
Bombardier’s backlog of future orders rose to $58.6 billion at the end of September from $53.9 billion at the end of last year, the company said.