Bombardier partners with BAE Systems to explore combat fighter jets

Plane maker Bombardier Inc. BBD-B-T is partnering with British defence contractor BAE Systems BAESF on a new effort to develop technological and industrial capabilities for future combat fighter jets.

The companies signed a memorandum of understanding to explore opportunities to collaborate across several key areas, including research and development, systems integration, and work force and supply chains, they said in separate statements Wednesday.

Bombardier chief executive Éric Martel is pushing to expand its defence business as countries around the world boost their military spending. The unit blew past its original US$1-billion revenue target five years ahead of its 2030 target.

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This summer, Canada signed on as an observer to the Global Combat Air Programme, or GCAP, a joint initiative by Britain, Japan and Italy to develop a next-generation fighter aircraft that will enter service in 2035. “Concrete co-operation” between Canada and program members is now under discussion, Japan’s Ambassador to Canada Masashi Nakagome told The Globe and Mail last month.

Joining the GCAP, even as an observer, is part of Canada’s efforts to diversify its defence ties and economic relations beyond the U.S. It could also be a prelude to one day purchasing the sixth-generation aircraft produced by the three allied countries or participating more fully in their trilateral initiative.

BAE Systems, which manufactures military aircraft as well as submarines and other products, is playing a lead role in the GCAP. It is collaborating with Italy’s Leonardo and Japan’s Mitsubishi Heavy Industries, with companies such as Rolls-Royce, IHI Corp. and Avio Aero also involved.

Bombardier said it sees the pact with BAE as “an important step” in analyzing how its aerospace expertise and manufacturing operations could contribute to the development of future air combat capabilities. The company’s defence unit currently specializes in converting its commercial business jets into surveillance and reconnaissance aircraft, but it doesn’t make fighters.

Canada’s observer status in next-generation fighter jet program comes with no costs

Sweden’s Saab AB, a Bombardier defence partner on the GlobalEye Airborne Early Warning & Control aircraft, had offered the Canadian company the opportunity to build its Gripen fighter under licence in Canada. Bombardier was cool to the idea, saying it was already stretched for capacity in its own factories, and Saab announced this week it would tap Halifax-based IMP Aerospace & Defence instead to run a Canadian final-assembly line.

Bombardier is in advanced talks with Saab on producing its GlobalEye surveillance planes in Canada, however. The Montreal company wants to take on a bigger slice of production on the aircraft program as a way to capture more economic value from the alliance, and currently favours Toronto as a possible production site.