MONTREAL -Canadian planemaker Bombardier said on Thursday it is checking whether any of its customers could be subject to sanctions following Russia’s invasion of Ukraine.
Bombardier Chief Executive Eric Martel, who spoke after laying out the business jet maker’s 2025 financial objectives to investors, said the company’s supply chain is not impacted by the crisis, but about 5% or 6% of deliveries traditionally come from customers in the region.
Martel said he did not know of any customers who are now facing sanctions, but acknowledged there are developments “every hour.”
“We’ll see what are the sanctions, and we may have, I don’t know, to terminate some of these agreements if there are sanctions on some of our customers,” Martel told reporters after the company’s investor day.
Corporate planemakers are capitalizing on a pandemic-fueled boom in demand for private aircraft, with global business jet flight sectors up 12% so far this year compared with pre-pandemic January and February 2019, according to data research and consulting company WINGX.
But the Russian crisis has rapidly displaced the pandemic as the most significant destabilizing factor in the European region, WINGX said, with European Union leaders saying they will impose wide-ranging, new sanctions on Russia over its invasion of Ukraine.
Earlier in the day Bombardier said it is aiming to build up to $600 million per year for use toward special projects, such as a possible new plane or debt repayment, as part of a 2025 target.
The pure-play corporate planemaker, which has shed assets in recent years after facing a cash crunch in 2015, is separately targeting more than $500 million in free cash flow in 2025.
Bombardier is targeting the biggest ever expansion of its aftermarket division to nearly double revenues from such services to $2 billion in 2025 compared with 2021.
(Reporting by Allison Lampert in MontrealEditing by Chizu Nomiyama; Editing by Leslie Adler)
