Airbus + Bombardier Vs. Boeing + Embraer (Giants Duel)

Airbus + Bombardier Vs. Boeing + Embraer (Giants Duel)

In 2017, the US-Canada trade conflict turned into a conflict between Boeing and Bombardier. Airbus jumps into the Bombardier defense, and Boeing seeks to align itself with a partnership with Embraer.

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The market for commercial aircraft is divided between two major players - Airbus and Boeing - and other smaller manufacturers, such as Embraer (Brazil) and Bombardier (Canada).

Airbus + Bombardier

Airbus, Bombardier

After Delta placed an order for 75 on the Bombardier C Series aircraft, Boeing complained to national authorities, accusing Bombardier of receiving public subsidies. Following the notification, the US government introduced an anti-dumping duty of approximately 220%. Thus a C Series plane would have cost over 160 million, compared to the standard 80 million price.

In October 2017, Airbus jumps to the aid of the Canadian manufacturer and signs a partnership to take over the majority of the C Series aircraft family. In other words, Airbus and Bombardier will jointly manufacture the new C Series aircraft. Thus, Airbus can also cover the 80-130 market segment of seats.

The partnership between Airbus and Bombardier comes to the package with many benefits for the C Series program. Production of C Series aircraft will remain in Québec, but the supply chain Airbus will be used, which will reduce production costs.

Under the agreement, Airbus will provide the acquisition, sales and marketing for C Series Aircraft Limited Partnership (CSALP), the commercial entity that produces and sells C Series aircraft.

Airbus will hold 50,01% in CSALP, and Bombardier and Investissement Québec (IQ) will own approximately 31% and 19% respectively. In all this madness, Bombardier will be able to continue to market C Series aircraft in the United States.

Boeing + Embraer

Boeing and Embraer

What is Boeing doing? He allies with Embraer, the direct competitor for Bombardier on the 80-130 aircraft market. The partnership between Boeing and Embraer could bring the same benefits as the partnership between Airbus and Bombardier.

Embraer will benefit from Boeing's commercial influence in negotiations with suppliers and future customers, which could help reduce costs. Boeing will rely on the new E-2 Embraer aircraft, with its commercial debut scheduled for April 2018. This will allow you to offer a wide range of aircraft, from 80 to 400 seats.

The absence of these regional jets in the Boeing portfolio resulted in the loss of the contract with Delta Air Lines, which chose Bombardier CS100 to replace the old MD88.

In other words, Airbus + Bombardier will work together to ensure the production and marketing of C Series aircraft. Thus Airbus can offer a wide range of aircraft (80-800 seats).

And Boeing and Embraer will work together on the production and marketing of Embraer E-2 aircraft. Thus Boeing will remove the catalog of aircraft with capacities between 80 and 400 of seats.

So far, Embraer has registered orders for 233 aircraft (E175-E2, E2-E190 and E195-E2) from 6 airlines, while Bombardier has firm orders for 360 family-series aircraft. 20 of CS100 and CS300 aircraft are already in commercial service in the Swiss and airBaltic fleets.

Which camp will win? Airbus + Bombardier or Boeing + Embraer?

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