A plane flies over a Bombardier plant in Montreal on Jan. 21, 2014.Christinne Muschi/Reuters
Bombardier Inc. has put on ice a turboprop project in Russia because of the unfavourable climate there, Bombardier Inc. chief executive officer Pierre Beaudoin said.
"We are not going ahead because the conditions are not favourable for the creation of a joint venture in Russia," Mr. Beaudoin said Thursday on a conference call with reporters.
"We're putting aside the project for now," he said.
Canada and the United States have joined the European Union in imposing sanctions on Russian companies and individuals over Russia's actions in eastern Ukraine.
Russia's economy is also suffering as a result of falling oil prices.
Mr. Beaudoin said Bombardier will re-assess the project's viability in a few months' time.
Talks between Bombardier and its Russian joint-venture partners had already been sputtering as tensions over the past several months increased/
Montreal-based Bombardier struck a preliminary accord in August, 2013, for final assembly in Russia of its regional Q400 jet as well as clinching a $3.4-billion agreement for the sale of 100 of the planes to Russian industrial and defence conglomerate Rostec and leasing firm Ilyushin Finance Co.
The initial target was for the deals to close before the end of this year.
Mr. Beaudoin said on Thursday that talks for the sale of the Q400 aircraft continue and that Bombardier is looking at other ways to penetrate the Russian market.
A large sale of Q400s in Russia would solidify Bombardier's presence in the country and the region and also counter a threat from lower-priced turboprop manufacturer ATR.
Bertrand Marotte