PPRuNe Forums - View Single Post - Bombardier offers majority stake in C Series to Airbus
Old 27th Oct 2015, 22:18
  #74 (permalink)  
peekay4
 
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Willie, just because a program is beyond break-even, that does NOT mean sales are "mostly profit". It just means that they're no longer losing money on each sale.

And those numbers Bombardier provided are mostly a lie. Why? Because manufacturer announcements are based on "list price", but we know no one actually buys at list price!

Bombardier won't tell you: what was the discount from list? What is the actual margin on revenue?

Suppose we assume industry-standard 50% discount and a very generous 15% margin, that means even if all $651m in options are exercised, Bombardier's total profit from the entire deal is only $50 million, spread over several years.

That's nothing. Bombardier is burning more than $80 million per month on the CSeries. So even Bombardier closes similar-sized CRJ/BBJ deals each and every month for the next three years, that still won't come close to covering the CSeries program costs.

That's how big of a hole Bombardier have dug themselves in!
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