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Airbus announces second line in Mobile

By Brandon Moseley 
Alabama Political Reporter

Monday, Airbus announced that it has acquired a 50.01 percent stake in the C Series Aircraft Limited Partnership with Bombardier. While the headquarters and main assembly plant for the Bombardier aircraft, Airbus will move some Bombardier C Series aircraft production to its plant in Mobile.

“This acquisition by Airbus and promise of new investments in Alabama show that our aerospace sector is strong and that our workforce can support an additional assembly line. Alabamians take pride in their work and that is showing on Airbus aircraft around the world. We look forward to adding the C Series aircraft as another product proudly made in Sweet Home Alabama,” Alabama Gov. Kay Ivey said in a statement.

“Tonight’s announcement from Airbus is a testament to the first-class workforce in Southwest Alabama and our pro-business culture. I want to share my deep appreciation with Airbus for their continued investment in Mobile and our community. This announcement is yet another step toward our region becoming a national and global hub for aviation excellence,” U.S. Rep. Bradley Byrne, R-Montrose, said.

“This is a win-win for everybody! The C Series, with its state-of-the-art design and great economics, is a great fit with our existing single-aisle aircraft family and rapidly extends our product offering into a fast growing market sector. I have no doubt that our partnership with Bombardier will boost sales and the value of this programme tremendously,” said Airbus Chief Executive Officer Tom Enders. “Not only will this partnership secure the C Series and its industrial operations in Canada, the U.K. and China, but we also bring new jobs to the U.S. Airbus will benefit from strengthening its product portfolio in the high-volume single-aisle market, offering superior value to our airline customers worldwide.”

“We are very pleased to welcome Airbus to the C Series programme,” said Alain Bellemare, president and chief executive officer of Bombardier Inc. “Airbus is the perfect partner for us, Québec and Canada. Their global scale, strong customer relationships and operational expertise are key ingredients for unleashing the full value of the C Series. This partnership should more than double the value of the C Series programme and ensures our remarkable game-changing aircraft realizes its full potential.”

Airbus said in the press release, that the combination of Airbus’ global reach and scale with Bombardier’s newest aircraft family will create significant value for customers, suppliers, employees and shareholders. Airbus predicted that it would produce significant C Series production costs savings anticipated by leveraging Airbus’ supply chain expertise. Airbus and Bombardier remain commited to Québec. The Canadian city will remain the C Series Aircraft Limited Partnership headquarters and primary assembly line with the support of both companies’ global supply chains. Airbus’ global industrial footprint expands with the C Series Final Assembly Line in Canada, resulting in a positive impact on operations in Québec and across the country. The growing market for C Series will result in a second Final Assembly Line in Mobile, Alabama, serving U.S. customers.

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Under the agreement, Airbus will provide procurement, sales and marketing, and customer support expertise to the C Series Aircraft Limited Partnership, the entity that manufactures and sells the C Series. At closing, Airbus will acquire a 50.01 percent interest in CSALP. Bombardier and Investissement Québec will own approximately 31 percent and 19 percent respectively.

The single aisle market is a key growth driver, representing 70 percent of the expected global future demand for aircraft. Ranging from 100 to 150 seats, the C Series is highly complementary to Airbus’ existing single aisle aircraft portfolio, which focuses on the higher end of the single-aisle business – 150-240 seats. The world class sales, marketing and support networks that Airbus brings into the venture are expected to strengthen and accelerate the C Series’ commercial momentum.

The Board of Directors of CSALP will initially consist of seven directors, four of whom will be proposed by Airbus, two of whom will be proposed by Bombardier, and one of whom will be proposed by IQ. Airbus will be entitled to name the Chairman of CSALP.

The transaction has been approved by the Boards of Directors of both Airbus and Bombardier, as well as the Cabinet of the Government of Québec. The transaction remains subject to regulatory approvals, as well as other conditions usual in this type of transaction. There are no guarantees that the transaction will be completed and that the conditions to which it is subject would be met. Completion of the transaction is currently expected for the second half of 2018.

Airbus is a global leader in aeronautics, space and related services. In 2016 it generated revenues of $79 billion and employs a workforce of around 134,000. Airbus offers the most comprehensive range of passenger airliners from 100 to more than 600 seats and business aviation products. Airbus is also a European leader providing tanker, combat, transport and mission aircraft, as well as one of the world’s leading space companies. Airbus also builds civil and military rotorcraft.

Bombardier is one of the world’s leading manufacturers of both planes and trains. Bombardier is headquartered in Montréal, Canada and is traded on the Toronto Stock Exchange. In the fiscal year that ended Dec. 31, 2016, Bombardier posted revenues of $16.3 billion.

Brandon Moseley is a former reporter at the Alabama Political Reporter.

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