Bombardier to cut 2,500 aviation jobs as COVID-19 slams demand

(Reuters) – Canadian business jet maker Bombardier Inc said on Friday it would cut 2,500 jobs, or about 11% of its workforce, at its aviation unit as the COVID-19 pandemic’s crushing impact on the air industry adds to its long list of problems.

The airline industry has been among the worst hit by the coronavirus crisis, which has dented travel demand and forced several aircraft manufacturers, including Bombardier’s peers Boeing Co and Airbus SE, to cut production as customers defer deliveries.

“Bombardier must adjust its operations and workforce to ensure that it emerges from the current crisis on solid footing,” the company said in a statement, citing an estimated 30% fall in business jet deliveries across the industry due to the pandemic.

Bombardier, which has nearly 60,000 employees at its aviation and rail units, said it would book a $40 million related to the job cuts.

The company, which agreed to exit the commercial aircraft business in February, is in the process of selling its rail business to French TGV high-speed train maker Alstom for up to 6.2 billion euros ($7.02 billion), and said last month that the deal has not been affected by the coronavirus crisis.

In May, Bombardier reported negative free cash flow of $1.6 billion for the first quarter and said it expects a similar number for the current quarter, when business is anticipated to hit a low point.

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