Bombardier Inc.'s long-delayed CSeries aircraft program received a big boost on Monday, when the company announced two tentative orders for a total of up to 24 jets worth nearly $1.6 billion.
Montreal-based Bombardier said it had signed an agreement with Chinese carrier Zhejiang Loong Airlines Co. Ltd. for 20 of its CSeries jetliners.
The order for the CS100 version of the jets, which comes on the first day of the Farnborough International Airshow in England, would be worth roughly $1.28 billion, if confirmed, Bombardier said.
Separately, the Canadian aircraft and train manufacturer said Petra Airlines Ltd. of Jordan had also signed a letter of intent to buy up to four CS100 and CS300 planes. If confirmed, the order would include two CS100 aircraft and two options for CS300 aircraft worth a total of about $298 million.
The tentative orders come just two days after Falko Regional Aircraft Ltd., a lessor based in Britain, signed two letters of intent to buy up to 24 CS100 jets. The tentative orders were the first new CSeries orders announced since the first quarter.
Bombardier is hoping to crack the lucrative 100- to 149-seat jet market with its CSeries aircraft. That segment of the market is currently dominated by Boeing Co. and Airbus Group .
But the CSeries, which Bombardier touts as having superior fuel and operating efficiencies, has faced a myriad of obstacles including multiple delays for the multibillion-dollar program. Most recently, engine problems have grounded the test planes.
Expectations around whether Bombardier would be able to win any orders for the aircraft at Farnborough have been muted, as the CSeries planes are not making an appearance at the world's largest aerospace event.
Bombardier had last announced a commitment for a CSeries back in February, when Abu Dhabi-based Falcon Aviation Services signed a letter of intent for one CS300 aircraft and an option for another. On Monday, Bombardier said Falcon had signed a firm purchase agreement for the two aircraft valued at about $153 million.
Bombardier has now booked orders and commitments for 495 CSeries jets, including just over 200 firm orders. It aims to have 300 firm orders by the time the plane enters into service.
"Our entry into service is targeted for the second half of next year and we feel comfortable being able to get there," Bombardier's aerospace head, Guy Hachey, told CNBC on Monday.
Analysts said on Monday that Bombardier shares may get a lift with the new orders and updates from both the company and its engine maker Pratt & Whitney that the engine setback was not serious in nature.
"While we expect the positive updates to act as a near-term catalyst, we still see a period of elevated program risk for the CSeries," RBC analyst Walter Spracklin said in a note.
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