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Bombardier wins order for up to $3.3-billion from Delta

Bombardier Aerospace CRJ 900 series aircraft.

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Bombardier Inc.'s sluggish regional-jet sales just a got a major boost with a firm order for 40 CRJ900s from Delta Air Lines Inc. valued at $1.85-billion (U.S.)

The airline has also taken options on 30 more aircraft which – if converted to firm orders – would make for a total value of $3.29-billion for 70 jets.

Montreal-based Bombardier has experienced a slump in sales of its once high-flying regional jets over the past few years, a situation somewhat offset by continued strong sales of its larger business jets.

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The company also has placed a big bet for the future on its new C Series jet in the 100-to-149-seat category.

For Atlanta, Ga.-based Delta – a long-time Bombardier customer – the decision to go with the CRJ900 NextGen regional aircraft is based on its perceived cost-efficiency and also on the fact that an agreement has been struck with its pilots for expanded use of the 76-seat jets on certain routes.

"Building on a relationship that is 20 years strong, we are delighted that Delta – one of the world's largest, most prestigious global airlines – continues to select Bombarider CRJ regional jets to replenish its fleet," Bombardier Commercial Aircraft president Mike Arcamone said in a news release Thursday.

Bombardier says the CRJ900 NextGen offers improved fuel consumption thanks to a larger winglet and other refinements to the CRJ900.

Desjardins Securities analyst Benoit Poirier said in a research note Thursday that the order further boosts Bombardier's 2013 regional aircraft backlog, which he calculates at 107 planes.

And he said there could be more order activity ahead with Garuda Indonesia expected to place a big order for about 50 turboprops this year.

"Aside from this, there are opportunities with SkyWest and American Airlines for orders of regional jets, but we believe that these will be more a 2013 story."

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Mr. Arcamone said in an interview that there are encouraging signs of an uptick.

"The economy has improved. Airlines are out looking for new aircraft, more fuel-efficient aircraft to meet their routes. And of course the easing of the scope clause, that helps as well. So airlines are more prone to look at better aircraft that fit their business mode. If you as me if this is a resurgence? Definitely. It's a momentum."

He said the company is working on clinching more large regional-jet deals through sales campaigns.

"I can tell you that we're definitely going to be in many more campaigns in North America. This will be just a start."

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About the Authors
Quebec Business Correspondent

Bertrand has been covering Quebec business and finance since 2000. Before joining The Globe and Mail in 2000, he was the Toronto-based national business correspondent for Southam News. He has a B.A. from McGill University and a Bachelor of Applied Arts from Ryerson. More

Guy Dixon is a feature writer for The Globe and Mail. More

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