The airplanes that grab the attention of the public and investors are usually the ones with the newest creature comforts, dramatically reduced fuel consumption, and the most impressive appearance. This attraction to the latest in the industry is what has made events like the Paris Air Show so popular. It is also what has driven investor interest behind The Boeing Company (NYSE:BA)’s composite 787 and the development of the largest passenger jet ever, the A380 manufactured by Airbus, a subsidiary of European Aeronautic Defense and Space Company. But another aircraft manufacturer sees potential for its existing offerings in emerging markets and is working hard to gain ground in Africa.
A growing air travel market
Canadian transportation company Bombardier, Inc. (TSE:BBD.B) proudly states that it is the only transportation company making both trains and planes. While the trains segment is a major part of Bombardier, Inc. (TSE:BBD.B), the company sees major emerging markets growth potential in its aerospace division.
Bombardier, Inc. (TSE:BBD.B) has spent over $3 billion and several years to develop a state of the art narrowbody plane to compete with The Boeing Company (NYSE:BA) and Airbus in the 110-160 passenger segment. While the new plane, called the C Series, is going to be very important to Bombardier, Inc. (TSE:BBD.B)’s future, its growth in Africa is expected to be driven by existing offerings in the regional jet and turboprop segments with the C Series making up a smaller part of sales.
Talking to Aviationweek, Bombardier, Inc. (TSE:BBD.B)’s senior vice president of sales and marketing Chet Fuller says that Africa is “exactly the kind of market the Q400 was built for.” But besides Bombardier, Inc. (TSE:BBD.B)’s Q400 turboprop, Fuller also says that there is demand for the C Series and that Africa is making a “great second home for used CRJ-200s.” Followers of the airline industry may have noticed the movement away from the 50 seat aircraft (like the CRJ-200) and toward larger regional jets like the CRJ-700 or even to The Boeing Company (NYSE:BA) 717s as Delta Air Lines, Inc. (NYSE:DAL) chose to do. As a result, the market for CRJ-200s is filling up with used jets, however increasing demand from Africa may help airlines to get better prices for their CRJ-200s.
Despite this movement away from small regional jets, Bombardier can still find customers for its Q400 turboprops, just recently delivering one to Canadian airline WestJet Airlines Ltd. (TSE:WJA). With the Q400 seeing growing demand in Africa, Bombardier will be able to capitalize on sales from both developed markets and emerging markets for its Q400 series.
