Why I'm Sold On CSeriesIt's "Black Friday" here in the U.S. with many people taking the day off to shop. Libraries and a lot of other places are closed so that might explain the lackluster trading session.
To those who complain about performance and the lack of orders you need to be patient. If you're looking to make a quick buck by betting Bombardier will get a big order soon, look elsewhere. There's a good chance you'll be disappointed.
CSeries will get more orders but it could wear your patience out in the interim. You'd be well advised to buy this stock only if you are firmly convinced Bombardier's innovative capacity will eventually take it higher, and you can afford to wait.
CSeries is a great product. If you aren't sold on that take a closer look and compare it to the competition. People like Chet Fuller don't give up their jobs at GE to sell this aircraft if they weren't convinced of that. The same can be said for Gary Scott, who originally headed the team that built the most successful commercial aircraft ever, the Boeing 737.
So, even if you don't know much about aircraft it should be pretty obvious that people like this don't bet their careers an their living, on a program that looks iffy.
CSeries will be much more fuel efficient than anything currently in the air. It will be cleaner, quieter, and cheaper to maintain.
It, very effectively, targets Embraer's E-190 which currently dominates the regional jet market. And CSeries should be successful enough on its own by just doing that. But CSeries has a kicker, and that's the idea that it will probably be extended from the current designs to the 150-to-190-seat market. And this is what has the likes of Boeing and Airbus excited.
They're excited because CSeries is cleaner, quieter, and much more fuel efficient than their current offerings in the form of 737's and 320s. But they're also in a bind because these companies have huge backlogs for thousands of these aircraft stretching out for several years worth of production. If they re-enginge they can only achieve some of the features of Cseries and what do they tell customers who have ordered their older models?
On the other hand, if they do a complete redesign they could make it to market a few years later with a "me-too" product which might be as good as CSeries...And that's if they use the same Geared Turbofan technology. If they opt to wait for superior jet engine technology add a few more years.
That could take them well out past 2020.
Republic and Lufthansa are already in line for CSeries. What do you think will happen once competitors notice themselves behind the 8-ball trying to compete against CSeries with outdated aircraft that are costing them 20% more to operate?
It seems reasonable to expect CSeries will at least be a moderate success. Even if it only attracts another few orders in the sweetspot of the two year period just prior to the start of production - which starts one year from the end of this year and then in the initial years of production - should be enough to break even on the project.
But CSeries could, and should be a huge success.