Bombardier’s African market foray hanging in balance over Angola’s president’s comment
Chukwuemeka Obioma is Businessamlive Reporter.
You can contact him on chukwuemeka.obioma@businessamlive.com with stories and commentary.
In a recent campaign to promote the Q400 planes for underserved markets in Africa, Bombardier’s foray into the African market maybe hanging in the balance as Angola’s president recently told a European news channel that a domestic airline startup was a “fictitious company,” doubting an order of Bombardier’s 6 Q400s.
Bombardier had earned an order from Ethiopian Airlines in a latest marketing campaign.
The company which looks to intensify marketing campaigns in Africa and India in the hope that airlines would pick the longer range Q400s to connect longer cities with secondary destinations which either do not have service or are served by jets that have higher operating costs at the moment considers India its largest market with the largest single order for its planes in 2017, from a low cost India carrier, SpiceJet .
Africa is also a major target market for Bombardier given that the region is saturated with low cost carriers. But João Lourenço’s comment about business in the region, industry sources say, dims hope for its business transactions in Africa.
In a statement recently published by Bombardier, the company said it is constantly looking at strategic options for all its businesses.
According to information available to business a.m., Bombardier also recently disclosed aims to reap more profits by promoting aftermarket services for its over 2,000 regional planes already in the air, which is part of a broader strategy to promote its business jets.
The company seeks to erase losses and generate $1.5 billion in revenues by 2020. But the turnaround strategy faces headwinds, industry sources reveal.
Bombardier’s resolve to activate regional plane sales, estimated as a $240 billion market between 2017 and 2036, comes on the heels of expected limited near-term sector growth.
Industry sources forecast that demand for regional aircraft will remain weak relative to large commercial aircraft. Moody also projects regional aircraft deliveries growth, including the CSeries, by over 4 percent in 12-to-18 months, compared with an 8-to-10 percent rise in larger aircraft.