Bombardier delayed its CSeries jetliner for a fourth time, saying the aircraft won’t enter commercial service until late next year instead of 2014 because it needs more time for flight tests.
The smaller CS100 model is now set to debut in the second half of 2015, with the larger CS300 to follow six months later, Bombardier said Thursday in a statement. The timeline erased plans for a CS100 introduction about a year after the first flight, which occurred Sept. 16.
Bombardier’s move confirmed predictions by analysts including Canaccord Genuity’s David Tyerman, who said last year that a postponement was inevitable. The maiden flight of the biggest-ever jet for the Montreal company was pushed back three times, bad weather has slowed trials and program costs have climbed to $3.9 billion, 15 percent more than projected.
“No one really expected entry into service 12 months after the first flight, but this is obviously a significant event and a big negative,” Tyerman said Thursday in a telephone interview from Toronto. “Unless they can find some cost reduction offsets, the budget is likely to go up.”
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Spending on the program may rise by more than $1 billion, Peter Arment, a Sterne, Agee & Leach analyst in New York, said in a note to clients. Bombardier uses about $200 million of cash on the CSeries every quarter, Arment said.
Bombardier is targeting the CSeries to compete with the smallest Airbus and Boeing single-aisle models, the workhorses of the global airline fleet. Seating capacity on the CSeries will range from 108 to 160, a step up in size for the plane maker whose regional jets are its signature commercial aircraft.
Mike Arcamone, president of Bombardier’s commercial aircraft unit, said no major design changes in the CSeries have been identified, and “this gives us confidence that we will meet our performance targets.”
“We are taking the required time to ensure a flawless entry-into-service,” he said in the statement.
Bombardier is planning 2,400 hours of test flights for the CSeries. The jet’s second prototype took off for the first time on Jan. 3, Bombardier said.
Chief Executive Officer Pierre Beaudoin is betting the CSeries can generate $5 billion to $8 billion of additional annual revenue by the end of the decade and help the company almost double sales. He hinted Oct. 31 that the year-from-first-flight timetable might change, saying the company was reviewing its plans and would provide an update “in the coming months.”
Sales have been slow to take off. Even after announcing a firm order Thursday for 16 CSeries jets from Saudi Arabia’s Al Qahtani Group, Bombardier is still 102 units short of a target of 300 firm purchases by the time that the jet enters service.
Bombardier has typically unveiled purchases in smaller batches than those for Airbus’s A320 and Boeing’s 737. The larger companies’ single-aisle models have routinely sold by the dozens or even hundreds of aircraft at a time.