Bombardier Aviation To Cut 2,500 Jobs From COVID-19 Impact
Bombardier Aviation plans to lay off 2,500 employees, primarily at its Canadian manufacturing facilities, throughout 2020 as it adjusts to lower business jet deliveries caused by challenges from COVID-19, the company said June 5.
The layoffs include 40 U.S. jobs, a spokesperson said. Bombardier is reviewing requirements for its Northern Ireland operations in all of its aircraft programs, and will relay any impact “in due course,” it said in a statement. Meanwhile, Bombardier’s worldwide customer service operations have continued to operate “largely uninterrupted” during the pandemic.
Bombardier said it will take a special charge of about $40 million related to the Canadian workforce reductions. Bombardier employs 60,000 in two business segments, including 22,000 in its aviation division worldwide. Nearly, 10,000 are employed by Bombardier Aviation in Canada, where Challenger and Global business jets are assembled.
Bombardier has reached the end of its ability to maintain pre-COVID employment levels, David Coleal, Bombardier Aviation president, said in a June 5 memo to employees.
“These past three months we have faced never-before-seen interruptions and challenges in business aviation,” Coleal said in the memo. Throughout the pandemic, Bombardier took measures to furlough workers and keep teams safe.
“We are now faced with the difficult decision to adjust the size of our business, considering both disruptions in our supply chain as well as industry-wide forecasts calling for approximately 30% year-over-year drops in unit deliveries due to the pandemic,” he said. “This situation is both frustrating and disappointing, especially given we began 2020 poised to grow our business with a continued focus on our talented team.”
Bombardier paused operations in Canada and in Belfast and Mexico in March to protect workers from the novel coronavirus. It gradually resumed operations in May. Business aviation’s financial impact during the first quarter of 2020 totaled $400-500 million from the inability to deliver aircraft because of travel restrictions, temporary production shutdowns and lower-than-expected order intake, Bombardier CEO Eric Martell said at the time. On June 1, Bombardier closed the sale of its CRJ regional jet program to Mitsubishi Heavy Industries, exiting the commercial aircraft industry
Longer-term, Bombardier hopes to return to pre-crisis demand levels, Coleal said. Its backlog, products and fundamentals continue to be strong