Monday, June 16, 2014

Bombardier lays off staff as new Learjet flight testing delayed

TORONTO (Reuters) - Canada's Bombardier Inc said on Monday that it has laid off more than 100 staff and let go 110 contract workers in the United States and Mexico due to delays in the flight test program for its all-new Learjet 85 business jet.

In the latest setback for its aircraft development program, which includes the behind-schedule and over-budget CSeries jetliner, Bombardier said a "few things" had affected the Learjet 85 development.

"Given that this was a real clean sheet design, using innovative technologies, we've had a learning curve and we've had some challenges," said Bombardier spokeswoman Isabelle Gauthier. "We're not where we expected to be in the program."

The Montreal-based company has not said when it expects the Learjet 85 to enter service, following a postponement last year of its projected service date, or how much it will cost.

Last week, Bombardier laid off 100 permanent employees and let go 40 contractors working on the Learjet 85 at its Wichita, Kansas, site, Gauthier said. Forty other Learjet 85 staff at the facility, which has about 2,800 employees, were reassigned to different aircraft programs.

The company also let go 40 contractors and reassigned 200 permanent staff working on the Learjet 85 at its Queretaro, Mexico facility, which employs 1,800 people, she said.

The affected employees, in production and operations, will be called back after Bombardier makes more progress with flight testing, she said.

Flight tests continue on the Learjet 85, Bombardier's largest business plane, but Gauthier would not say how many hours the aircraft has flown or when other test planes would begin flight.

The Learjet 85 was originally to enter service in late 2013, but early last year Bombardier postponed it to the summer of 2014.

The company has also been struggling with its CSeries commercial jet program. After an engine failed on May 29, ground testing resumed last week, but flight testing remains suspended.

The cost of the narrow-body CSeries, which will compete with the smallest jets made by industry leaders Boeing Co and Airbus, has ballooned to $4.4 billion, some $1.05 billion over original estimates. The service target has been pushed into the second half of 2015 from an initial target of late 2013.

In January, Bombardier cut 1,700 jobs across its aerospace unit in Canada and the United States to preserve cash.


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