Airbus on Monday announced that it has entered into a limited partnership agreement with Canadian aircraft manufacturer Bombardier to acquire a majority stake in the latter's C Series aircraft
The partnership brings together two complementary product lines, with 100-150 seat market segment expected to represent more than 6,000 new aircraft over the next 20 years, Airbus said in a release
The combination of Airbus' global reach and scale with Bombardier's newest aircraft family will create significant value for customers, suppliers, employees and shareholders, Airbus said.
The combination will help significantly reduce C Series production costs by leveraging Airbus' supply chain expertise, the release stated.
C Series Aircraft Limited Partnership headquarters and primary assembly will remain in Québec, Canada with the support of both companies' global supply chains.
The combination and the C series final assembly line in Canada will help Airbus expand its global industrial footprint, resulting in a positive impact on operations in Québec and across the country, it added
With a growing market for C Series there could be a second final assembly line in Mobile, Alabama, for the C series aircraft to serve US customers, it added.
Bombardier Inc is reported to have earlier discussed a potential sale of a stake in its C Series programme with Chinese firms before reaching a pact with European giant Airbus SE, according to people familiar with the talks.
Bombardier had been in touch with a small group of Chinese state-owned enterprises, including Commercial Aircraft Corp of China Ltd, about a C Series investment, reports citing unidentified sources familiar with the talks said.
Canadian innovation minister Navdeep Bains said the Airbus deal will mean more opportunities for Canada's aerospace sector.
''This is about Bombardier looking at a strategic partner," he told reporters in Ottawa on Monday night. "We're going to make sure that we get the best outcomes for the aerospace sector; we get the best outcomes for the employees."
Canadian governments have long been supporters of Bombardier. The federal government pledged C$372.5 million ($297 million) in "repayable program contributions" for a pair of Bombardier jet programmes earlier this year, including the C Series.
The Quebec government bought a 49.5 per cent stake in the C Series programme for $1 billion in 2015. That stake had been reduced to 38 per cent before the Airbus deal, and will be cut further to 19 per cent with the Airbus partnership. The province received no direct compensation for the reduction under the Airbus agreement.