Since assuming the post of president of Bombardier Commercial Aircraft in April, Fred Cromer has spent much of his early tenure assessing the strengths and weaknesses of an organization that has drawn its share of criticism over the CSeries’ slow industrial and commercial progress. But now that the program appears to have found some momentum in terms of its certification effort, Cromer can now set his sights on ensuring the company’s readiness to support the airplane in the field, and ultimately establish a foundation on which Bombardier can cultivate confidence among potential customers and financiers.
Finally registering orders for 300 airplanes by the time the CSeries gains certification–a target set by Bombardier hierarchy well before Cromer joined the company–certainly would aid the cause, as would helping to secure financing for one of the program’s largest customers, Russia’s Ilyushin Finance Company (IFC).
In an interview with AIN in early April, IFC general director and co-owner Alexander Roubtsov said he had begun reconsidering his company’s commercial commitments to the CSeries due not only due to Canadian sanctions placed on Russia for its annexation of Crimea and alleged support of separatists in eastern Ukraine, but because of his concerns over Bombardier’s readiness for high-quantity production, the availability of delivery slots and airline acceptance of the product.
Of course, Bombardier intends to dispel skepticism over its ability to maintain the pace of industrial progress it now appears to have achieved, and Cromer told AIN in an interview just before the Paris show that the manufacturer intends to behave “proactively” to ensure that the CSeries finds a position in the Russian market.
“Rather than sit around and be hopeful that sanctions will be lifted, we’re going to be a little more proactive and figure out with our Russian customers and our potential Russian customers a way to help them secure financing,” said Cromer. “I can’t go into specifics, but I can tell you those are conversations we’re having with our Russian customers right now.”
In the meantime, Bombardier and its newly announced launch operator–Lufthansa Group subsidiary Swiss International Airlines–continues preparations for entry into service in the first half of next year. Cromer characterized the decision by Lufthansa to not only become the launch customer but to commit to making Swiss the first operator as “natural” given the long relationship Bombardier has cultivated with the European airline, starting with service entry of the first 50-seat CRJ in 1992.
“The lines of communication are open…they know us, we know them, and this sort of feedback loop as the airplane goes into service is going to be extremely important to us,” said Cromer. “I’ve been through this before, and to have that level of communication with the OEM is going to be key. They’re obviously pretty sophisticated with Lufthansa behind them, [and with] Lufthansa Technik as part of that family as well. I think that we’re well positioned to be extremely successful with entry into service.”
Cromer should know, given his experience with fleet planning and acquisition at Northwest Airlines and Continental Airlines, then as CFO of Continental Express and, finally, CFO and president of International Lease Finance Company (ILFC). While working on the airline side of the business gave Cromer a broad exposure to North America, his experience at ILFC, half of whose business resides in Europe and 25 percent in Asia, lends him a global perspective that Bombardier felt it needed for the CSeries program.
“So developing the network with all the international carriers on top of what I already had in North America is something that I bring now to Bombardier in terms of customer connections,” explained Cromer, who also referred to his finance background. “So I can get a little creative when we think about how to finance airplanes into a new customer, as well as understand what an airline goes through in making a fleet decision,” he said.
On criticism from competitors and some analysts about the level of export credit agency financing on which Bombardier historically has relied, Cromer noted that although “at times” customers will certainly avail themselves of such support, no CSeries customer has yet received ECA financing.
“We’re actually seeing a lot of interest from the leasing community,” said Cromer. “Over the last year we signed on with five lessors and they are certainly helping our customers source solutions to the financing challenges facing the industry. As for ECA use, we are no different from any other OEM in that regard.”
Although Bombardier fully intends to gain certification by the end of this year, it has given itself a substantial time buffer to ensure on-time EIS. The cautious approach would seem warranted; as potential customers exhibit what Cromer called a “wait-and-see attitude” until certification authorities issue their approvals. “The general sentiment is that everyone wants us to get it right up front,” said Cromer. “We are now proving that to be the case, considering what we’re now seeing with the impressive performance–we’re building that market confidence.”
Having finished more than 60 percent of the flight-test hours required and 70 percent of the certification requirements, the program has performed as expected judging by the accounts of Bombardier executives.
“Coming from an aircraft fleet-planning background, I’ve helped bring new aircraft programs to market [before], and I can tell you that I’ve never seen an aircraft program that got it right up front–until now, that is,” said Cromer. “The CSeries is performing beautifully, [and I’m] very impressed with the data we are seeing.”