Tuesday, May 26th13.6°C
25412
24291

Bombardier aerospace CEO retires amid restructuring that will see 1,800 jobs cut

MONTREAL - Bombardier Aerospace president and CEO Guy Hachey is retiring after six years in the post amid a restructuring of operations at aerospace that will result in the layoff of 1,800 employees.

The Montreal-based company (TSX:BBD.B) says its aerospace division will operate in three segments — business aircraft, commercial aircraft and aerostructures and engineering services — each headed by an executive. The railway segment based in Germany remains intact.

Hachey, 59, took over the aerospace division in 2008 following a 30-year career in the automotive industry with General Motors and Delphi Automotive Systems.

He left the company Wednesday as its new CSeries commercial aircraft remains grounded following an engine incident at the end of May. The aircraft has undergone several delays and is now expected to be delivered in the second half of next year.

In a release issued Wednesday after markets closed, Bombardier said Hachey was retiring "as a result of this reorganization."

"Guy led Bombardier Aerospace during an important period in its history. I wish to thank him for his contributions over the past six years," Bombardier CEO Pierre Beaudoin said in a terse, one-line comment.

Spokeswoman Isabelle Rondeau declined to say how long the restructuring plans have been in the works and whether there was a disagreement between Hachey and the company that prompted the change.

"He's retiring today," she said repeatedly.

"We are changing the structure because the financial performance and execution have not met expectations and we want to have a lighter structure."

Rondeau said the change isn't the result of problems with the CSeries, nor should it be viewed as desperation by the transportation giant.

"It's a new step in the evolution of Bombardier...We've invested in products and we really feel this new structure will allow us to be more agile, more flexible. It will increase our focus on growth areas."

Effective immediately, the heads of all segments will report to Beaudoin. They are Lutz Bertling at Transportation, Eric Martel at Business Aircraft and Mike Arcamone at Commercial Aircraft. The head of the new Aerostructures and Engineering Services business segment will be appointed in the next few weeks.

This segment will focus existing efforts on the design and development of complex advanced composite and metallic aerostructures for all classes of civil aircraft, including fuselage, wings and engine nacelles.

Some aerospace functions and the customer services division will be absorbed into the three aerospace units, generating unspecified cost savings. The new structure will be in place Jan. 1.

Rondeau said the change will result in the layoff of about 1,800 "indirect" functions such as finance and human resources, or 4.8 per cent of Aerospace's global workforce of more than 37,000.

"It's really spread everywhere. Bombardier Aerospace worldwide, so it's not just Montreal."

Meanwhile, Bombardier said economic sanctions imposed on Russia could have an impact on the timeline of the company's plans to set up a plant in the country.

The Montreal-based giant was hoping to conclude negotiations this year with Russian company Rostec for the assembly of 100 Q400 regional jets in a project estimated at $3.4 billion.

Company spokeswoman Marianella Delabarrera said Bombardier is now being "realistic" about the possibility the project will be delayed.

Foreign Affairs Minister John Baird announced this week that Canada would slap sanctions against more Russian individuals and entities, including government agencies, over that country's continuing support for rebels in eastern Ukraine.

Canada has so far imposed sanctions against 110 individuals and entities.

Delabarrera said Rostec has not been targeted by the sanctions and that talks with the Russian company would continue.

On the Toronto Stock Exchange, Bombardier's shares closed down two cents to $3.74 on Wednesday.

Follow @RossMarowits on Twitter

The Canadian Press


Read more Business News

25185


Recent Trending




Today's Market
S&P TSX15167.56-19.84
S&P CDNX699.12-0.93
DJIA18100.23-131.79
Nasdaq5048.10-41.26
S&P 5002111.98-14.08
CDN Dollar0.8050-0.007
Gold1188.90-15.40
Oil59.45-1.22
Lumber273.80+3.70
Natural Gas2.816-0.071

 
Okanagan Companies
Pacific Safety0.14+0.01
Knighthawk0.010.00
QHR Technologies Inc1.51+0.02
Cantex0.03-0.01
Anavex Life Sciences0.4335+0.0085
Metalex Ventures0.08-0.01
Russel Metals25.83+0.00
Copper Mountain Mining1.31-0.02
Colorado Resources0.105+0.005
ReliaBrand Inc0.0048-0.0049
Sunrise Resources Ltd0.04+0.01
Mission Ready Services0.175+0.005
Decisive Dividend Corporation2.20+0.60

 



26471

FEATURED Property
2292821Interval Timeshare
$1,000
more details
Click here to feature your property
Please wait... loading


Cash stressed seniors

Photo: Thinkstock.comFor many Canadian homeowners, their house represents the biggest portion of their net worth. Now, increasing numbers of seniors are starting to recognize the hidden value of their...


Do or do not

Photo: Thinkstock.com“The optimist sees the rose and not its thorns; the pessimist stares at the thorns, oblivious of the rose.” - Kahlil Gibran Good planning is all about managing chan...


Penetrate the smokescreen

Photo: ContributedHas this ever happened to you? You’re in the middle of your second or third “good discussion” with a prospect. Everything’s going great. The prospect seems en...

_



25991

26363


Member of BC Press Council


26106