Bombardier to sell water bomber business, shift some work on Q400

TORONTO – A British Columbia company, Viking Air Ltd., has signed a deal to buy Bombardier’s amphibious aircraft program, which has been on hold since December.

Financial terms of the agreement were not disclosed.

The deal will see Viking acquire the manufacturing rights for all variants of Bombardier’s amphibious aircraft and assume responsibility for product support, parts and service.

Among the planes is the Bombardier 415 — used as a water bomber for fighting forest fires.

Victoria-based Viking manufactures the Twin Otter as well as spare parts for several planes originally made by de Havilland.

It also has manufacturing rights for all out-of-production de Havilland aircraft, including the DASH-7 regional airliner, a predecessor to Bombardier’s Q400 turboprop.

Viking employs just under 90 people in Calgary and more than 330 at its headquarters and facilities in Victoria. The company said it expects to add up to 40 people to its workforce in Victoria and Calgary with the new program.

The Montreal-based company hasn’t produced an amphibious plane since December 2015.

“This transaction supports our goal of rebuilding a clear path to profitable earnings growth and cash generation,” said Alain Bellemare, Bombardier’s president and chief executive.

“While the amphibious aircraft program is part of our long history, this divestiture positions Bombardier to better focus on our core, higher growth businesses: business jets, commercial aircraft and rail transportation.”

Meanwhile, Bombardier Aerospace says it plants to cut 200 positions at the company’s Q400 manufacturing operation in Toronto so some work can be outsourced to other countries.

Some of the Bombardier employees in Toronto will be offered training and transfer opportunities within the company. Others will be offered retirement packages under an agreement reached with their union, Unifor.

A Bombardier spokeswoman says the move is part of a five-year plan, announced in November, to make the company’s products more profitable and competitive in the long term.

Bombardier (TSX:BBD.B) plans to make the Q400 wings in Mexico and cockpits in China, for final assembly in Toronto.

The Toronto operation currently has about 3,500 employees — including 1,400 working on the Q400, a turboprop used by airlines around the world. Toronto-based Porter Airlines and WestJet’s Encore service are among the Q400’s customers.

Bombardier also does final assembly of the Global Express 5000 and 6000 business jets in Toronto. The Downsview plant is also scheduled to work on the longer-range 7000 and 8000 Global Express jets.

Bombardier spokeswoman Marianella de la Barrera said it’s too soon to say how many of the Q400 positions will be eliminated through retirements and how many will be dealt with through retraining and other mitigation measures.

“We can’t speculate until we’ve done the exercise with the union,” de la Barrera said Monday.

Scott McIlmoyle, president of Unifor local 112, was unavailable for comment.

Note to readers: This is a corrected story: A previous version erroneously said Bombardier was moving 50 jobs out of North Bay, Ont.