Bombardier Commercial Aircraft Update - May 2011

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MAY 2011 | VOLUME 22

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ISSUE 1

CSeries Adapting to the new realities

Bombardier Commercial Aircraft provides optimized aircraft solutions for short-haul, medium-haul and longer-range markets.

CSeries: optimized single-aisle mainline solution

CRJ NextGen: optimized regional jet solution

Q400 NextGen: optimized turboprop solution

adapting to the new realities // Q400 product improvements, market penetration // Inside: CSeries Chet Fuller interview // CRJ1000 NextGen fuel burn down, range up // Customer Services making more spares more available // CRJ Fleet grows in South America


CSeries Adapting to the new realities B

ombardier’s CSeries aircraft is being designed to adapt to “the new realities” facing both the airline and aircraft manufacturing industries, according to Gary R. Scott, President, Bombardier Commercial Aircraft. He told a meeting of the International Society of Transport Aircraft Trading, “We are facing oil at more than $100 a barrel; more mergers or consolidations; the environment, which is a given.” The 100- to 149-seat class CSeries is in exactly the right spot in the marketplace because the demand for this size of aircraft has never been greater, with 50 per cent of worldwide monthly departures below 150 seats. Bombardier’s 2010 market forecast predicts deliveries of 6,700 aircraft in this segment over the next 20 years and Bombardier expects to get a significant share of this market. The bulk of the CSeries components are being manufactured at five locations: Belfast, Northern Ireland; Saint-Laurent, Quebec; Shenyang, China; Mirabel, Quebec; and West Palm Beach, Florida where the Pratt & Whitney engine is being developed. Here, we provide updates on activities at the five locations.

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Belfast: The wing While the ultimate load test on the CSeries composite wing demonstrator was successfully completed on schedule at Bombardier’s Belfast, Northern Ireland facility, the company is continuing to test the demonstrator to fully understand the structure’s capability and evaluate suitable repair techniques. The load test took the wing to 150 per cent of the most severe in-flight forces the wing could likely experience. The composite wing demonstrator, manufactured and assembled using the Belfast operation’s patented Resin Transfer Infusion process, is part of the overall wing research and development program to prove out the technology, manufacturing and assembly processes being applied to the CSeries wing. One of the main aims of the wing demonstrator was to allow Bombardier to obtain as many results as possible before finalizing the production wing design, thereby significantly reducing the risk of failure or delay, and allowing the company to optimize weight savings. The Belfast facility has focused on areas that react to the high load inputs from aerodynamic forces, landing loads and the loads induced from the engine. This allows Bombardier to be absolutely confident that it has adequate margins of safety, even in the presence of in-service damage or manufacturing variations. The plan is to test the demonstrator to failure, generating further data and adding to the wing learning curve. “We are delighted with the test results we have obtained to date, which have confirmed that we will meet the target weight for the complete wing, including all the systems installations and control surfaces,” said Michael Ryan, Vice-president and General Manager, Bombardier Aerospace Belfast. “The tests have also confirmed that the Resin Transfer Infusion process is an excellent method by which to manufacture very large and complex one-piece composite structures.” Production of the CSeries wings is due to begin later in 2011 in a new wing manufacturing and assembly facility in Belfast, the first phase of which was completed on schedule near the end of 2010.

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Saint-Laurent and Shenyang: The fuselage Bombardier Aerospace has upgraded more than 9,000 m 2 (100,000 ft2) of its Saint-Laurent facility in Montreal to support major components of the CSeries. Components to be built include the carbon-fibre composite aft fuselage and cockpit. The cockpit will be mated with the forward fuselage section made in China by Shenyang Aircraft Corporation (SAC). Rigorous testing will simulate 180,000 flight cycles. Bombardier has capitalized on several years of composites technology at both Saint-Laurent and Belfast. Automated Fibre Placement (AFP) techniques are being used to build the aft fuselage, including the pressure dome. “Bombardier’s adaptation of AFP technology has also benefited from the largest collaborative aircraft structures demonstration project initiated by Canada’s National Research Council to advance AFP use in the aerospace industry,” said Hugues Lessard, Vice-president, Saint-Laurent Manufacturing Centre, Bombardier Aerospace. The Production Development team at Saint-Laurent is also responsible for designing and installing the tooling for the new CSeries aircraft final assembly at Mirabel, north of Montreal.

West Palm Beach and Mirabel: The engine Pratt & Whitney successfully completed initial ground testing for its first PurePower ® PW1000G engine — the PW1524G. The engine completed nearly 200 hours of ground testing. The first engine ran nearly three times longer than Pratt & Whitney’s experience for a first engine test program. Pratt & Whitney began ground testing of the PW1524G engine on schedule in September 2010. Assemblies of the second and third PW1524G development engines are nearing completion. Pratt & Whitney will send the second PW1524G geared turbofan engine to flight testing, rather than the third, since the results from engine No. 1 were so positive. Once engine No. 2 completes ground testing, it will be transferred to Pratt & Whitney Canada’s new Mirabel Aerospace Centre that opened May 6, 2011, a 27,971 m2 (300,000 ft2 ) state-of-the art global hub for engine testing. It also supports flight testing for the complete range of Pratt & Whitney Canada and Pratt & Whitney engines, including turboprops and turbofans up to 90,000 lb (40 kN). The Centre houses two Boeing 747SP aircraft that have been transformed into flying test beds. Flight testing of the CSeries engine is scheduled to begin during the summer of 2011. Engine No. 1 is being shipped to the company's new icing and environmental research centre in northern Manitoba for icing trials. Certification of the 23,300 lb (104 kN) PW1524G engine and first flight of the CSeries are both scheduled in 2012.

Mirabel: Final assembly Bombardier Aerospace has begun expanding its Mirabel facility north of Montreal to accommodate production of the first CSeries flight test aircraft for the flight test and certification program. The Complete Integrated Aircraft Systems Test Area (CIASTA), the first area of the Mirabel plant developed for the CSeries aircraft program, is progressing on schedule, with the integration of systems rigs in progress. New buildings for the CSeries aircraft program will include a supplier satellite area, final assembly structural joining and pulse line areas, an area for pre-flight testing, paint shops, and a delivery and administrative centre. The CSeries aircraft will be shorter than the 39 m (128 ft) CRJ1000 NextGen aircraft, the largest aircraft currently produced at Mirabel, but the CSeries aircraft will have a wider fuselage cross section, longer wings and a higher tail. Bombardier will therefore employ different final assembly techniques. For example, two pairs of robots will be used to drill holes, apply sealant and install fasteners to the major sections of the fuselage. “Advanced robot technology will provide predictable reliability, enhance quality and prevent ergonomic issues on the assembly line,” said Francois Minville, Vice-president, CSeries Manufacturing. “The fuselage of the CSeries is 3.7 m (12 ft) in diameter, which presents an assembly challenge using our conventional methods. The benefit of the robots is that they can work on the top, the side and underneath the aircraft without any limitations.” “We are enhancing our quality culture at Bombardier to support the production of the CSeries aircraft,” said Mr. Minville. “Through the sharing of knowledge and best practices, we are building our experience with aircraft programs that involve risk-sharing suppliers and are refining our processes.”

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P R O G R A M U P D AT E

Q400 gaining markets in North America The Q400 and Q400 NextGen aircraft have become major players in the North American regional airline marketplace in the last five years, with 101 aircraft representing 29 per cent of total deliveries as of January 31, 2011. A glance at the accompanying maps shows that early in 2006 two airlines, Horizon Air (now Alaska) and Island Air, operated 150 flights a day to 30 destinations. Today, five airlines – Frontier, Alaska, United Express, Porter Airlines and Air Canada Express – operate more than 600 flights a day to more than 75 destinations. In addition to commercial airlines, Hydro-Quebec operates two Q400 aircraft between Montreal and hydroelectric facilities in northern Quebec. The 15 Q400 NextGen turboprop airliners ordered by the former Jazz Air plus options on 15 more will increase the aircraft presence on the continent. These aircraft will be deployed in the central part of Canada, with the first route linking Toronto Pearson International and Quebec City Jean Lesage Airports to begin in June 2011. Other Q400 NextGen routes have yet to be announced. The 70-seat Q400 NextGen turboprop will replace 50-seat regional jets on a one-for-one basis. Air Canada has embarked on an ambitious program to re-brand almost the entire fleets of its regional airline partners as Air Canada Express. The move marks the end of Air Canada’s largest regional partner Jazz Air which, although separately owned by Chorus Aviation, will become Air Canada Express. The Capacity Purchase Agreement between Air Canada and Jazz, under which Air Canada purchases substantially all of the regional’s capacity, does not cover the Jazz charter fleet of two Dash 8-100 and three Dash 8-300 turboprops and one CRJ100 regional jet. These will continue to be branded as Jazz. Repainting the entire Jazz fleet of more than 120 Bombardier regional jets and turboprops is expected to take five to six years. In another move, Air Canada moved back into Toronto’s downtown Billy Bishop Airport (“The Island”) with four previously-owned Q400 NextGen aircraft operated by Air Canada Express operator Sky Aviation, Inc., in competition with Q400 NextGen aircraft operator Porter Airlines. Sky Aviation began flying the Billy Bishop-Montreal Trudeau airport route on May 1, 2011.

2006 North American Q400 Routes

Island Air Alaska

Total Destinations: 30 Total Flights per Day: 150

2011 North American Q400 Routes

Alaska Frontier United Express Porter Airlines Air Canada Express

Total Destinations: 75 Total Flights per Day: 600

Q400 product improvements continue Bombardier Commercial Aircraft continues to improve the Q400/Q400 NextGen turboprop airliner with a wide range of initiatives. These include: A 1.5 per cent improvement in fuel efficiency in 2011, in addition to the two per cent

improvement announced in 2009. Further efficiencies are being investigated. A seven-seat business class passenger configuration to be available in late summer, 2011. A new drop-down oxygen system to provide up to 22 minutes of emergency oxygen. Performance-based navigation for more efficient use of airspace resulting in shorter routings and additional fuel efficiencies; better obstacle clearance; and avoidance of noise-sensitive areas. Left: The Q400 NextGen aircraft’s new business class interior.

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I N T E R V I E W

Chet Fuller Prior to joining Bombardier in December 2010, Charles (Chet) R. Fuller was Chief Marketing Officer and, more recently, President, Civil Systems, GE Aviation. He has also held senior executive positions at Honeywell Aerospace and ATA Airlines. Mr. Fuller spent 14 years in the United States Navy as an aircraft carrier pilot and instructor pilot, flying mainly A-6 Intruder and E-2 Hawkeye aircraft during which he completed 300 carrier landings. Update: In your short time with Bombardier Commercial Aircraft, what have been your first impressions? Fuller: Bombardier is the third-largest aircraft manufacturer in the world. But I find it’s a quiet company that doesn’t spend a lot of time on self promotion. People usually know they’re on an Airbus or Boeing aircraft, but most people who fly in regional jets have no idea who makes them.

Senior Vice-president Sales, Marketing and Asset Management

This is a phenomenal company with a great aviation capability, and we are going to be very successful with the CSeries. Update: What do you consider to be Bombardier’s major strengths competing in the aerospace industry? Fuller: Its major strengths are its ability to execute programs, something like 28 new aircraft programs in the last 20 years. That’s a lot of programs from a company with a lot of experience and knowledge in both airline and business aircraft. So it’s exciting to be in a relatively small company compared to Airbus and Boeing that has such a track record of success. Update: In terms of sales and marketing, what are you focusing on in order to meet the needs of your customers and prospects? Fuller: We are undergoing what we call a commercial transformation to create a sales factory to compete with Airbus and Boeing. That’s a heck of a challenge because they are the best in the business and they lack for nothing. The 110- to 149-seat market is for us a large capacity market, so we are entering a

new space where the competition is not just Embraer but Airbus and Boeing. And when you enter that space you have to be able to compete successfully with others in that space. Update: What challenges do you see facing airlines and how do you see Bombardier’s product line-up addressing them? Fuller: The airlines are in a constant battle to make a profit. It’s a tough business with lots of competition in lots of markets – an airline can have five or six competitors in the same market. As I said, it’s difficult to make a profit so they need a game-changing aircraft and that’s the CSeries. And with the CSeries, we will have a best-in-class aircraft for the better part of a decade. Update: What challenges do you see facing Bombardier in the future? Fuller: In the immediate future it is having an aircraft in development that will face the best in the world. We have to sell this preproduction aircraft, and that makes the challenge greater. But our whole mission and goal is to make the CSeries real and to deliver on our production commitments.

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CRJ1000 NextGen FUEL BURN DOWN, RANGE UP

PROGRAM UPDATE After nearly five months in revenue service, Bombardier’s newest and largest regional jet, the 100-seat CRJ1000 NextGen, has shown a fuel burn reduction of four per cent and a range increase of six per cent from earlier predictions. Schedule Completion Rate was above 99.9 per cent while the Dispatch Reliability Rate averaged 99.4 per cent. The data covers the CRJ1000 NextGen aircraft operated by launch customers Brit Air of France and Air Nostrum of Spain. Air Nostrum has placed firm orders for 35 CRJ1000 NextGen aircraft while BritAir has placed firm orders for 14. Based on a four per cent reduction in fuel burn from earlier predictions, and using the industry yardstick of a 500-nm sector, Bombardier has calculated that a CRJ1000 NextGen flying 2,200 flights a year, at a fuel price of $3.10 U.S. per gallon, will save slightly more than $220,000 in fuel costs. “After a few weeks of revenue service, we already notice an excellent dispatch reliability and a reduction in fuel consumption of nearly 20 percent,” said Pascal Frochot, Vice-president, Flight Operations at Brit Air, early in February, 2011. “The brand new design of the NextGen cabin interior enhances our customers’ comfort with its LED lighting, larger windows and our new leathercovered seats. The CRJ1000 NextGen will really help us to gain new profits in the European market.” The EL (European Light) variant of the CRJ1000 NextGen regional jet has a maximum take-off weight of 85,968 lb (38,995 kg) to reduce operating costs in the European environment. Maximum take-off weight of the basic CRJ1000 NextGen aircraft is 90,000 lb (40,824 kg). Bombardier estimates that the maximum take-off weight of the EL variant compared to an older technology

100-seat jet will result in a cost advantage of $73 per flight over a 500-nm (926 km) sector. “The introduction of the CRJ1000 NextGen regional jet is yet another example of our innovation, inspiration and ingenuity,” said Guy C. Hachey, President and Chief Operating Officer, Bombardier Aerospace. “In the span of only 25 years, Bombardier Aerospace became the third largest civil aircraft manufacturer in the world, and all of us at Bombardier take enormous pride in the fact that every three seconds, somewhere in the world, a Bombardier aircraft is taking off or landing.” Steven R. Aliment, the Munich-based Vice-president, European Sales at Bombardier Commercial Aircraft, cited economics and commonality as the greatest assets of the CRJ1000 NextGen regional jet. “The aircraft is powerful, it has the best economics in its class, and it is a member of the only true family of regional jetliners spanning 50 to 100 seats. “We have commonality in the General Electric engines, commonality in crewing and maintenance procedures, commonality, for the most part, in spare parts. These are very significant and profitable advantages for our customer. An analysis conducted by Bombardier for Air Nostrum concluded that the 100-seat CRJ1000 NextGen had a 34 per cent operating cost advantage over a 100-seat Fokker 100, based on a 500-nm (926 km) stage length. The CRJ1000 NextGen airliner is the “greenest” member of the CRJ family. Over a 500-nm (926 km) sector, this 100-seat regional jet will burn as little as 3.33 litres of fuel per 100 km per seat. It will produce 85 grams of CO2 per km per seat, setting the new benchmark for 100-seat class regional jets.

“ The CRJ1000 NextGen will really help us to gain new profits in the European market.” Pascal Frochot, Vice-president, Flight Operations at Brit Air

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May 2011 // 6


GLOBALLY. LOCALLY. WE PUT

Customer Services and Support

Macon

wins a Diamond from FAA

“Our growth and achievements at Macon over the past year reflect a growing commitment by Bombardier to deliver world-class maintenance access to customers faster and closer to their base of operations.”

It only took a year for Bombardier’s Commercial Aircraft Service Centre in Macon, Georgia to win a coveted Diamond Award of Excellence from the U.S. Federal Aviation Administration. It’s the highest honor an aviation maintenance employer can receive, and recognizes the commitment of the centre and its technicians to ongoing training and education. “The Bombardier Aircraft Service Centre network has been offering the highest quality of support to our customers for close to 30 years, and this distinguished award confirms our Macon Service Centre as a shining example of a proud tradition,” said James Hoblyn, President, Customer Services & Specialized and Amphibious Aircraft, Bombardier Aerospace. “Our growth and achievements at Macon over the past year reflect a growing commitment by Bombardier to deliver world-class maintenance access to customers faster and closer to their base of operations.” FAA Diamond Awards have also been awarded to Bombardier Commercial Aircraft Service Centres in Bridgeport, West Virginia, Tuscon, Arizona and the Line Station at the Ronald Reagan National Airport in Washington, D.C.

Making more parts more available

Bombardier and Fokker Services have entered a strategic alliance to better support Dash 8/Q-Series 100/200/300 aircraft operators. Called FLY, the program is aimed at improving the availability of components and reducing the cost of repairs of these out-ofproduction aircraft, while also helping operators to better predict and budget for material maintenance. From left are: Raj Ramajuman, Managing Director, Fokker Services Asia; John Bennett, Director, Parts Logistics, Bombardier Commercial Aircraft; Gary Martin, Vice-president, Sales Marketing and Service Programs, Bombardier Commercial Aircraft; Erik Geertsema, Vice-president, Logistic Services, Fokker Services; Todd Young, Vice-president, Customer Services and Support, Bombardier Commercial Aircraft; Ad Liebreks, Director, Business Development, Fokker Services.

Bombardier Commercial Aircraft Customer Services has been planning and executing a strategy designed to increase parts availability throughout the company’s worldwide network. A new forecasting model takes an aggressive look at regional demand as well as considering intermittent demand. With improved forecasting algorithms and using advanced inventory optimization methodologies, Bombardier has invested more financial resources into its inventory plan, in which the Chicago facility has already begun to receive parts. An additional 12,000 purchase orders were placed in a one-week period to support the new service levels. More inventory will be ordered over the coming months. “We are expediting purchase orders that have been placed with the supply chain in order to integrate the parts into our worldwide network,” said John Bennett, Director, Customer Services, Parts Logistics. Once they have been deployed into the regional network, customers will be able to access more parts from more locations than before. Throughout the entire distribution network, 110,000 Stock Keeping Units (SKUs) will be deployed representing an approximate 30 per cent increase in the number of SKUs from the current 77,000.” The plan also increases the overall stocking set for the Q100, Q200 and Q300 aircraft-specific parts by more than 50 per cent, from 7,320 to 12,157, representing a significant investment. These parts will soon be deployed into the worldwide network for the benefit of the operators of these aircraft.

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GROWS IN SOUTH AMERICA

The order from Pluna Líneas Aéreas Uruguayas S.A. of Montevideo for three additional CRJ900 NextGen regional jets, announced April 25, 2011, gives Bombardier’s CRJ family additional exposure in the increasingly important South American marketplace. The Pluna order will increase its CRJ900 NextGen aircraft to 13; the airline’s fleet consists solely of the Bombardier jetliner. “The Bombardier CRJ900 NextGen aircraft has allowed us to increase frequencies and expand to new markets,” said Matias Campiani, Chief Executive Officer, Pluna. “The aircraft offers a combination of low operating costs, exceptional passenger comfort and proven high reliability.” In Argentina, Andes operates two CRJ900 regional jets while Conviasa in Venezuela has four CRJ700 aircraft in its fleet.

Status (January 31, 2011) Series 100 Series 200 Series 300 Series 400 Program total

Delivered Backlog 299 0 105 0 267 0 344 62 1,015 62

Total 299 105 267 406 1,077

Dash 8-100/Q200/Q300 Fleet statistics, January 2011 Average flight time (mins.) 50 Average annual utilization (hours/cycles) 1,740/2,078 Highest annual utilization (hours/cycles) 3,084/4,609 Fleet total hours 20,160,307 Fleet total cycles 24,453,969 Schedule completion rate 99.5% 12-mo. Avg. Q400 Fleet statistics, February 2011 Average flight time (mins.) Average annual utilization (hours/cycles) Highest annual utilization (hours/cycles) Fleet total hours Fleet total cycles Schedule completion rate

55 2,080/2,270 2,756/3,578 2,752,695 3,029,947 99.6% 12-mo. Avg.

CSeries Facts and Figures Status (January 31, 2011) CS100 CS300 Program total

Delivered Backlog 0 33 0 57 0 90

Total 33 57 90

*Does not include operators of corporate aircraft. Utilization based on schedule data.

Bombardier Commercial Aircraft President: Gary R. Scott

Status (January 31, 2011) CRJ100 CRJ200 CRJ440 CRJ700 CRJ705 CRJ900 CRJ1000 Challenger 800 Program total

Delivered Backlog 226 0 709 0 86 0 305 19 16 0 244 18 9 40 33 0 1,628 77

CRJ100/200 Fleet statistics, January 2011* Average flight time (hrs.) Average annual utilization (hours/cycles) Highest annual utilization (hours/cycles) Fleet total hours Fleet total cycles Schedule completion rate 99.7%

Total 226 709 86 324 16 262 49 33 1,705

1.06 2,222/2,101 3,440/3,626 22,696,437 19,795,820 12-mo. Avg.

CRJ700/705/900 Fleet statistics, January 2011* Average flight time (hrs.) 1.39 Average annual utilization (hours/cycles) 2,658/1,914 Highest annual utilization (hours/cycles) 3,372/2,875 Fleet total hours 7,130,745 Fleet total cycles 5,242,204 Schedule completion rate 99.7% 12-mo. Avg. CRJ1000 Fleet statistics, March 2011 Average flight time (hrs.) Fleet total hours Fleet total cycles Schedule completion rate

update

1.11 4,218 3,923 99.9% 12-mo. Avg.

Commercial Aircraft

is published by:

Senior Vice-president, Sales, Marketing and Asset Management: Chet Fuller

Bombardier Commercial Aircraft

Vice-president, Sales, Americas: Kevin Smith

123 Garratt Boulevard, Toronto, Ontario

Vice-president, Marketing: Philippe Poutissou

Canada M3K 1Y5

Vice-president, Customer Services and Support: Todd Young

Tel: +1-416-375-4027 // Fax: +1-416-375-4540

Cert no. XXX-XXX-000

www.aero.bombardier.com

Information, technical data and performance figures in this publication are subject to change without notice. This publication does not intend to convey any guarantees or warranties. Any guarantees or warranties on any subject are extended to customers only as may be provided in their purchase agreements. Articles in Commercial Aircraft Update may be reproduced without permission, providing the acknowledgement is given to Bombardier Commercial Aircraft Update.

Copyright © Bombardier Inc. 2011 Printed in Canada. *Bombardier, Q-Series, Q400, CRJ Series, CRJ700, CRJ900, CRJ1000, CRJ, NextGen, CSeries, CS100 and CS300 are registered Trademarks or Trademarks of Bombardier Inc. or its subsidiaries.

Q Series Dash 8 Facts and Figures CRJ Series Facts and Figures


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