August 01, 2013
Bombardier’s CEO Pierre Beaudoin said “a lot of small stuff” has led to the most recent delay in the first flight of the CSeries prototype FTV1.
“Wires have been plugged in upside down. It is nothing significant, but we need to learn. Sometimes what we thought would take half a day takes two days,” he said Aug. 1 during the company’s second quarter earnings call.
Bombardier has pushed back first flight of FTV1, which was supposed to have happened by the end of last month, according to the latest adjusted schedule. The manufacturer now expects the test aircraft to fly “in the coming weeks,” to ensure “mature systems integration for a productive flight-test program.” Beaudoin refused to commit to a new date.
Sources within the supply base indicate that Bombardier has informed them of the additional delay. But unlike in its public statements, the company has left the new timing completely open, rather than limiting the schedule shift to a period of weeks. That has led to concerns about the severity of the problems that Bombardier is facing and whether the delay may be prolonged.
Beaudoin also refused to give new guidance regarding an entry into service date. He reiterated that the flight-test program is scheduled to take 12 months. If Bombardier is unable to catch up on the delay, that would imply entry into service not before August 2014.
Beaudoin also cautioned that “it is a flight-test program” with risks involved.
The latest slip, which now adds to a cumulative delay of more than half a year, is not adding material costs, says Beaudoin. However, Bombardier is under enormous pressure to keep the program from slipping too far: Its negative free cash flow reached $1.15 billion in the first six months of the year, $920 million of which can be attributed to the aerospace segment. But the company still has liquidity of $4.5 billion, which it considers to be “strong.”
Bombardier will only make the decision on the launch of large-scale CSeries production and hiring of additional staff once flight tests are underway and estimates on timing become more reliable. Production will start in the existing facilities to limit additional investment, but would move to a new building once it is needed.