There is more money to be made in China, despite some of the less-than-hopeful news we heard out from behind what used to be called the "bamboo curtain". There are indeed companies who still want to trade with the West, buying its quality goods to solidify the Far Eastern behemoth’s march to economic strength.
One such example occurred this week, as Montreal-based transportation kingpin Bombardier Inc. (T.BBD.B) and China’s Commercial Aircraft Corp.—or COMAC for short – announced what the Montreal Gazette called "a broad exploratory framework agreement of cooperation" between its CSeries and COMAC's C919, both airliners in development.
Sources said the initiatives to be completed over the next 12 months involve the cockpit, electrical system, aluminum-lithium specifications, publications and co-location of customer service teams.
Bombardier President Pierre Beaudoin said in Beijing Wednesday that the four initiatives "will build on the complementary nature of our respective products and expertise while helping to maximize both parties' cost savings and market shares."
The deal helps Bombardier solidify its aerospace manufacturing footprint in China, which Beijing expects for the aircraft-maker to sell its planes there. Asia, and China in particular, is in the process of taking over from North America and Europe as the world's largest aircraft market.
In CSeries sales campaigns, which have lagged in China, Bombardier can now "point to a larger model that many have been asking about," he was quoted in the paper as saying.
The CSeries will be powered by Pratt & Whitney's geared turbofan engine, while the C919 will feature CFM's LEAP-X. The Bombardier plane has 138 firm orders while the Chinese aircraft has 175 firm orders.
Bombardier is the world's third-largest commercial aircraft manufacturer and largest maker of trains. Not yet four years old, COMAC is China's main commercial aircraft company.
Bombardier ended trading Friday on the Toronto Stock Exchange up nine cents, or 2.2%, from the day before, to $4.25, in the middle of a 52-week price range that peaked at $7.29 on March 31 of last year, before easing to a gulch of $3.30 in mid-December.
