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Quebec asks federal government to rescue troubled Bombardier
QUEBEC provincial Premier Philippe Couillard made a bid to have the Canadian federal government rescue Montreal plane and train maker Bombardier as its stock fell to a five-month low and the company faced production cuts and delays.
Bombardier's marquee jetliner - the C Series - is so important to Canada's future that the federal government must invest, said Premier Couillard, Bloomberg reported.
The C Series "is by far the most innovative project in Canada in a very strategic sector, and clearly to me, the federal government has to be part of that," Mr Couillard said.
"A federal government that talks as often as they do of innovation cannot stay away from the most important innovation project in Canada," he said.
More than nine months after discussions began over a possible US$1 billion investment, Bombardier and federal officials have yet to reach a deal.
Prime Minister Justin Trudeau's government has sought corporate-governance concessions in exchange for any aid, Bloomberg News reported earlier this year.
Quebec is investing $1 billion for a 49.5 per cent stake in the C Series.
"Investors are concerned about another potential production cut in 2017," said Konark Gupta, a Macquarie Capital Markets analyst.
The possibility that the Global 7000 could enter service later than planned also weighed on the stock.
A supplier has been struggling with "the wing of the 7000, which will be a profitable product," said Cai Von Rumohr, a Cowen & Co analyst. "The target is to start delivering it in 2018, and that could be an issue."
Bombardier's marquee jetliner - the C Series - is so important to Canada's future that the federal government must invest, said Premier Couillard, Bloomberg reported.
The C Series "is by far the most innovative project in Canada in a very strategic sector, and clearly to me, the federal government has to be part of that," Mr Couillard said.
"A federal government that talks as often as they do of innovation cannot stay away from the most important innovation project in Canada," he said.
More than nine months after discussions began over a possible US$1 billion investment, Bombardier and federal officials have yet to reach a deal.
Prime Minister Justin Trudeau's government has sought corporate-governance concessions in exchange for any aid, Bloomberg News reported earlier this year.
Quebec is investing $1 billion for a 49.5 per cent stake in the C Series.
"Investors are concerned about another potential production cut in 2017," said Konark Gupta, a Macquarie Capital Markets analyst.
The possibility that the Global 7000 could enter service later than planned also weighed on the stock.
A supplier has been struggling with "the wing of the 7000, which will be a profitable product," said Cai Von Rumohr, a Cowen & Co analyst. "The target is to start delivering it in 2018, and that could be an issue."
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