Bombardier withdraws 2020 guidance and suspends operations in Canada amidst Coronavirus crisis
- Bombardier withdraws 2020 guidance and suspends operations in Canada amidst Coronavirus crisis.
- Bombardier places 70% of Canadian workforce on furlough to minimize the fast spread of COVID-19.
- Bombardier to further explore options to enhance its cash position to survive through the crisis.
In light of the rising cases of Coronavirus in Canada, Bombardier said on Tuesday that it would halt operations at the majority of its Canadian facilities for one month to help minimize the spread of the flu-like virus and protect its workers against the health hazard. Due to the virus-driven uncertainty, the Canadian multinational manufacturer of business jets also withdrew its financial guidance for 2020 on Tuesday.
According to Bombardier, rail and aircraft production will remain suspended in Ontario and Quebec for up to a month. Further decision regarding operations will be announced on the basis of how the virus unravels in the next month.
Bombardier Places 70% Of Canadian Workforce On Furlough
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The Ontario plant handles the final assembly of world-renowned business jets like the Global 7500, 6500, and 5500. Bombardier’s Ontario based facility will begin with a shutdown for two weeks starting from Tuesday while Quebec’s plant will hold operations until 13th April 2020. During this period, a few of the essential activities will proceed as normal.
In its announcement on Tuesday, Bombardier also said that about 70% of its Canadian workforce or 12,400 employees have been placed on furlough. The senior leadership of the company including the CEO will not be receiving their salaries during this period.
All discretionary spending, Bombardier added, will be cut to enhance the company’s cash position as the company also weighs its options to further enhance liquidity. At all of its facilities located in Northern Ireland, Bombardier will suspend operations until April 20th.
Bombardier’s Worker In Toronto Tests Coronavirus Positive
In his capacity as the union’s chairperson, Bill Bell was reported quoting on Monday’s interview that one of the Bombardier’s workers was tested positive for the flu-like virus in Toronto, following which, a few of his colleagues suspected to have been in contact were also sent home.
COVID-19 has so far infected around 2,000 people in Canada and has caused 24 deaths.
At the time of writing, Bombardier is exchanging hands at around £0.25 per share in the stock market that translates to over 75% decline in 2020 so far. Its performance in 2019 wasn’t reported any better either with an annual loss of around 10%. The stock opened at around £1.25 per share in January 2019 and closed the year lower at £1.14 in December.
Bombardier currently has a market of £680 million.