Bombardier (TSE:BBD.A)(TSE:BBD.B)(OTCQX:BDRBF) is slashing about 1,800 jobs from its aerospace business, and will split the unit into three in a move announced late yesterday designed to cut costs and improve operations at the world's third biggest aircraft maker.
The company told investors that its aerospace group functions and the customer services division will be absorbed into three aerospace business segments, generating cost and overhead reductions.
The new organizational structure will see the company divided into a total of four units, known as Bombardier Transportation, Bombardier Business Aircraft, Bombardier Commercial Aircraft and Bombardier Aerostructures and Engineering Services.
The head of the new aerostructures and engineering services segment, which is expected to help Bombardier market its expertise in the field to the aerospace industry and thus generate new revenues, will be appointed in the next few weeks, the company said.
"This marks another step in Bombardier's evolution," said president and CEO Pierre Beaudoin.
"Combined with the implementation of OneBT, the recent Bombardier Transportation reorganization, the new Aerospace organizational structure will enable us to be more agile and flexible in addressing customer needs, while increasing our focus on growth areas."
The company also said Wednesday that as a result of the reorganization, Bombardier Aerospace's president and chief operating officer, Guy Hachey, is retiring.
A detailed implementation plan will be developed over the next few months, Bombardier said, with the new structure to be in place by the start of next year.
Bombardier is the world's only manufacturer of both planes and trains. Earlier this month, the company said it won a total of 74 orders and commitments valued at more than $4.25 billion, should all commitments be converted to firm orders, at the 2014 Farnborough International Airshow. The orders came despite the fact that flight tests for its upcoming CSeries jet had to be halted in May after one of the engines failed.
Shares of the Montreal-based company fell more than 2 percent on Thursday, to C$3.66 as of 1:52pm ET.