Supporting Bombardier, Aerospace Industry: A Profitable Investment for Canada
In fact, Bombardier received approximately $180 million in loans for this program and reimbursed $315 million – representing a 175% return for taxpayers
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July 4, 2019 - by By Olivier Marcil for torontosun.com
In a recent letter to the Toronto Sun, Aaron Wudrick uses the sale of the CRJ program as a pretext to argue that Bombardier is "[cashing] out while taxpayers get stiffed." While Mr. Wudrick is entitled to his opinion on whether or not governments should support strategic industries, he picked the wrong target.
With 1,950 aircraft ordered to date, the CRJ program was a great commercial success, and this resulted in significant reimbursements to governments. In fact, Bombardier received approximately $180 million in loans for this program and reimbursed $315 million – representing a 175% return for taxpayers.
It's true that Bombardier has benefited from government support over the years. Our 21,400 Canada-based employees and our hundreds of Canadian suppliers are very grateful for this support. However, we reject assertions that Bombardier has cost taxpayers billions while giving nothing back.
Mr. Wudrick and others argue that Bombardier received "$4 billion from Canadian taxpayers" since 1966, but this amount is obtained through a questionable methodology. First, it includes more than $400 million in public support granted to two separate companies before they were even acquired by Bombardier. Second, the $4 billion figure includes over $1 billion in inflation adjustments.
If we look at actual numbers, from 1986 to 2009, Bombardier received a series of reimbursable loans totalling $596 million. These loans were repaid with interest through royalties on aircraft sales. Bombardier repaid $760 million (or 127% of the amount initially received).
Then, Bombardier received...