Bombardier To Lay Off 1,000 as Learjet 85 Program Halted

Employees in Wichita and Mexico to get the ax.

Learjet 85

Learjet 85

Canada's Bombardier said today it is halting its Learjet 85 development program amid weak business jet demand and will lay off about 1,000 employees at its sites in Querétaro, Mexico, and Wichita, Kansas.

The Lear 85 is the first all-composite business jet from Bombardier, and was to become the new flagship of the Learjet division in Wichita. Much of the composite fabrication work for the airplane is carried out in Mexico, with final assembly planned to take place in Kansas.

Learjet was preparing for full-scale certification testing of the first Model 85 prototype before Bombardier ordered a stop to work on the program. The company, however, left open the door that development could resume when market conditions improve.

"Bombardier constantly monitors its product strategy and development priorities," said Pierre Beaudoin, President and Chief Executive Officer of Bombardier Inc. "Given the weakness of the market, we made the difficult decision to pause the Learjet 85 program at this time. We will focus our resources on our two other clean-sheet aircraft programs under development, CSeries and Global 7000/8000, for which we see tremendous market potential. Both programs are progressing well."

The CSeries regional jet has been facing its own series of challenges, from delays to cost overruns to renewed competition from Boeing and Airbus, both of which have re-engined their existing single-aisle airliners to counter the impact from Bombardier's market entrant.

Bombardier's stock tumbled the most in five years after the Learjet 85 delay and job cuts were announced, as the company said it will book $1.4 billion in pretax fourth quarter costs related to shutting down the program.

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