Bombardier's C Series hit by new setback as engine fails

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Bombardier Inc.'s C Series program, already facing cost overruns, has suffered another setback after an aircraft engine failed during ground testing in Quebec.

The plane manufacturer said Friday that it is investigating what occurred late Thursday afternoon on one of Flight Test Vehicle 1's Pratt & Whitney engines.

"There was an engine-related incident during stationary ground maintenance testing involving the C Series FTV1 aircraft," Bombardier said.

"Bombardier is investigating the incident with the support of Pratt & Whitney and the appropriate authorities. Safety is the priority, and the C Series aircraft flight test program will resume once the investigation is completed." Bombardier has been seeking to make inroads into territory traditionally dominated by Boeing Co. and Airbus SAS. It is touting the narrow-body, twin-engine C Series as a more fuel-efficient aircraft than rival jets having 100 to 149 seats.

Canada's Transportation Safety Board said it has sent an investigator to Mirabel, north of Montreal, "where a Bombardier CS-100 aircraft experienced an engine failure during ground testing."

"The TSB will gather information and assess the occurrence."

Bombardier Aerospace spokesman Marc Duchesne confirmed the engine failure. "The incident was contained very effectively by our crew, with the support of the Aéroport de Mirabel emergency unit," he said.

The company does not anticipate a delay to the planned commercial debut of C Series deliveries in the second half of 2015.

"The purpose of the flight testing is to test the limits of the aircraft, so these kinds of incidents are not abnormal," Mr. Duchesne said. "We believe we are going to find the root cause of this in a timely fashion" to allow testing to resume.

The engines have been certified by federal transport officials, Mr. Duchesne said. He declined to offer further details or say if there was a fire but added that no one was injured.

Canaccord Genuity analyst David Tyerman said the sketchy information available so far makes it hard to immediately assess the impact the engine failure could have on the C Series.

"It's all going to come down to, 'What is the problem and how serious is it?'" he said. "If it's something significant to the engine, it could create significant delays."

Bombardier's current cash flow is healthy but it could be hurt if there is a very lengthy delay to the program, Mr. Tyerman added.

The C Series program has had a rocky history, experiencing delays since being formally announced in 2008. Cost overruns have dogged what is now a $4.4-billion (U.S.) program, up roughly $1-billion from earlier estimates.

In a research note earlier this month, National Bank Financial Inc. analyst Cameron Doerksen said he wanted to see more evidence before becoming bullish on Bombardier. "We would like to see more progress on the C Series test flying, as well as additional C Series orders to further validate the long-term viability of the program," he said.

Bombardier has been trumpeting the C Series jets because they would burn 20 per cent less fuel than existing regional aircraft. The planes, which make use of new technologically advanced engines, are also being touted as an upgrade in traveller comfort, with larger windows and better seat designs.

Testing for the CS-100 has involved four Flight Test Vehicles so far. Bombardier also plans to build a longer version called the CS-300.

Air Canada recently suspended its plans to order the C Series, though the carrier said it thought the plane itself is a good narrow-body aircraft.