Sunday, September 22, 2013

BlackBerry Bought Corporate Jet in July: Smartphone Maker Acquired Used Plane as Losses, Job Cuts Loomed

WATERLOO, Ontario—Canadian smartphone maker BlackBerry Ltd., which on Friday said it was set to post a loss of almost $1 billion for the quarter ended Aug. 31 and slash 40% of its workforce, only two months ago added a larger plane to its corporate-jet fleet.

The company purchased a 2006 Bombardier Global Express in July, according to Canadian aircraft-registry records. Although the price it paid for the jet couldn't be learned, similar planes are listed for sale for about $25 million to $29 million on a used-aircraft marketing website.

Less than a year ago, beset by slumping sales, BlackBerry sold one of its three corporate jets to cut costs. The sale left it with two Dassault Falcon jets that it had purchased several years earlier.

BlackBerry said Sunday that it acquired the used Global Express in July, but added that it now plans to sell its entire corporate-jet fleet due to its current financial straits.

"Earlier this year the company decided to sell both [Dassault] planes and replace them with one longer-range aircraft," company spokesman Adam Emery said in a statement. "The company considered several options and selected a used Bombardier aircraft, which was eventually delivered in July," he said.

Social-media posts indicate the older Dassault jets were spotted in Europe as recently as early this month, including on a flight to Marseille, France.

Mr. Emery said he wasn't sure when the two older jets were last used, but said he didn't "believe they have been flown since we took delivery of the newer used jet."

The new business jet, manufactured by Bombardier Inc. of Canada, is considerably larger than the jet BlackBerry sold last year, and can fly from New York to Tokyo without refueling.

"In light of the company's current business condition," Mr. Emery said, "the company has decided to sell that aircraft along with the two legacy aircraft and will no longer own any planes."

BlackBerry also said Friday that it would seek to cut operating costs by 50% after sales of its latest line of phones flopped. The company will write down nearly $1 billion in unsold phone inventory in the latest quarter.

A version of this article appeared September 22, 2013, on page B2 in the U.S. edition of The Wall Street Journal, with the headline: BlackBerry Adds Company Jet— But Not for Long.


Source:   http://online.wsj.com