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Bombardier boosts China standing with $134-million jet deal

Bombardier's CRJ900 airliner is shown in this undated handout photograph.

HANDOUT/REUTERS

Bombardier Inc. is extending its presence in the growing Chinese market with a $134-million (U.S.) deal to sell three CRJ900 NextGen regional jets to China Express Airlines.

Montreal-based Bombardier also has a conditional purchase agreement with China Express for five CRJ900s as well as options on an additional eight units.

If all of the conditional orders and options are converted to firm orders the deal will be worth $733-million.

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The two figures are based on list prices. Aerospace manufacturers typically offer discounts off the list price to buyers.

For Bombardier, the agreements with China Express follow on the announcement in October that a Chinese leasing company is the undisclosed, previously announced customer that signed a conditional purchase agreement for five C Series CS 100 and 10 CS 300 jetliners. There are also options on an additional five CS 100s and 10 CS 300s for a total of up to 30 C Series planes.

"With China's growing economy, improved support infrastructure and expanding middle-class, regional air travel will be more accessible to Chinese citizens in more regions," Bombardier Commercial Aircraft president Mike Arcamone said in a statement Monday.

"As demonstrated by China Express, the outstanding economics of Bombardier's CRJ NexGen aircraft will allow airlines to profitably enter smaller tier-two and tier-three markets, providing efficient service to a growing demand from business and leisure travelers."

More than 140 Bombardier-made planes, including CRJs and Q-Series turboprops as well as Learjet, Challenger and Global business jets, are flying in China, said Bombardier.

China Express is China's only specialized regional airline.

"By 2016, we anticipate that the total number of China Express routes will reach approximately 90, three times as many as the number of existing routes, and will cover 60 per cent of China's regional cities," said Wu Longjiang, president of China Express.

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About the Author
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

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