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Bombardier to lay off 7,000 as 2015 loss widens to US$5.3 billion

CANADIAN plane maker Bombardier said it planned to cut 7,000 jobs as the Quebec-based company widened its 2015 net loss to US$5.3 billion from $1.2 billion in 2014, from revenues of $18.1 billion, which fell 10 per cent year on year.

The company said it had a letter of intent from Air Canada to buy at least 45 of the plane maker抯 C Series jets.

The job cuts, from a workforce of 64,000, will occur during the next two years and result in restructuring charges of as much as $300 million, the company said.

The Air Canada deal, while not a firm order, represents a list value of about $3.8 billion. The airline has an option to purchase an additional 30 C Series aircraft.

Bombardier CEO Alain Bellemare, appointed a year ago with a mandate to restore profitability, is working to overcome cost overruns and delays on the C Series aircraft program.

Having reached agreement on $2.5 billion worth of asset sales in the fourth quarter, Mr Bellemare is now hopes for funding from Canada's federal government.

The Quebec provincial government agreed in October to invest $1 billion in the C Series programme and to shore up funding for the jet and assuage customer concern.

Provincial Transport Minister Jacques Daoust has since said the province is seeking an equivalent commitment from the federal government.

Bombardier also raised $1.5 billion by selling 30 per cent of its rail unit to Caisse de Depot et Placement du Quebec, the provincial public pension fund.