12,400 employees of Bombardier will now be put on unpaid leave as Bombardier temporarily halts production. Board members will forgo compensation for the remainder of the year. The shutdown was set to start Tuesday evening and continue until April 26.
The covid-19 crisis is hitting the Montreal-based firm after an already difficult start to 2020. Last month Bombardier announced the sale of its rail division, and it doesn’t expect new business jets with an already unsteady economy.
Financial Bank previously lowered its delivery forecast for Bombardier business jets from 154 to 145 planes this year, and from 150 to 120 for 2021. The backlog for the Global 7500, Bombardier’s new, ultra-long-range business jet listed at US$73 million apiece remains healthy, with the aircraft sold out through 2022.
Affected factories are in Mirabel, Saint-Laurent, Dorval and Pointe-Claire, and east of Quebec City in La Pocatiere.
“The bigger issue is going to be the supply chain, because they’re very complicated pieces of equipment with hundreds if not thousands of suppliers,” said AltaCorp Capital analyst Chris Murray.
Shares were between 38 and 50 cents this past week, their cheapest price in decades.