The Chamber of Commerce of Metropolitan Montreal

The Bombardier-Airbus deal: a lesson in humility for tomorrow’s leaders

Alain Bellemare, President of Bombardier, and Tom Enders, President and CEO of Airbus, greatly admire each other. According to Mr. Enders, the C Series airplane deal represents a wind of change and an opportunity to capture 50% of the single-aisle aircraft market, thanks in part to Quebec’s expertise and Airbus’ network and production capacity.

 

A lesson that any company leader must be aware that the challenges they face go beyond sales, that what’s at stake can also have an impact on many families. This realization made an impression on one of the students who attended the conference.

" It’s important to be proud of your achievements, but you also need to get support when necessary. You can’t let your ego become more important than what’s in the best interest of your employees, their families, and your shareholders. "

- Francis Marois, graduate student in mechanical engineering at UdeS and UdeS ambassador to Aéro Montréal’s Regroupement Relève.

The recipe for success: innovation, strategy, and the power of sale

Only one week after the partnership was announced, Airbus’ sales forecasts increased by 50%. A fact that speaks for itself, according to Alain Bellemare.

" This partnership will more than double the value of the C Series program and will allow our innovative aircraft to reach its full potential. "

The President of the aeronautical giant knows that he can’t please everyone and is aware that some might feel trepidation as Airbus takes over the reins of the C Series. However, Tom Enders is completely aware of the value of Quebec’s industrial gem.

" We need the engineering talent that comes with the C Series. No one should be afraid. Yes, we are going to use a plant in Alabama, but we will stabilize the industry here. "

It is also worth noting that there is a significant third party in this transaction: the government of Quebec. Quebec Premier Philippe Couillard, who also attended the conference, said the deal was a good one for Quebec.  Furthermore, he reaffirmed that the goal was always to bring in a “strategic partner” but that the government had to intervene to safeguard “the sector and workers.”

Boeing will have to come to terms with this alliance

Airbus was approached in 2015, but because there was so much at stake, negotiations required a strategic approach and planning.

It is thanks to these efforts that Bombardier and Airbus were able to join forces at a crucial moment when Boeing was putting pressure on the U.S. market. The resulting 300% anti-dumping tariff meant the American market, and the 30% of sales it represents for Bombardier, was no longer on the table for the Quebec company.

By opening an assembly line in Mobile, Alabama, Bombardier and Airbus could overcome this major challenge while benefiting from an economy of scale thanks to a decrease in manufacturing costs.

Delta Air Lines was reassured by this initiative and says it “looks forward to adding C Series aircraft to its fleet.” It is “ready to wait” for the new assembly line to open to finalize the purchase of 75 airplanes, a deal that was interrupted in 2016 as a result of Boeing’s complaint. 

What do the leaders of tomorrow think?

Students and future leaders attending the conference took away important lessons from Alain Bellemare when it comes to what actions you can take as a company leader facing an impasse.

The next generation of workers are certain that Airbus and Bombardier will both profit from this partnership. It will lead to the “sustainability of the C Series program”, “create added value for Airbus’ aircraft”, “increase the sales figures” of both manufacturers and will generate economic benefits for “Bombardier’s entire supply chain.”

Students were able to attend this event thanks to the Leaders of tomorrow program and the support of Power Corporation Canada.