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Illustration of Chet Fuller, Bombardier's senior vice-president of sales, marketing and asset management. (Anthony Jenkins/The Globe and Mail/Anthony Jenkins/The Globe and Mail)
Illustration of Chet Fuller, Bombardier's senior vice-president of sales, marketing and asset management. (Anthony Jenkins/The Globe and Mail/Anthony Jenkins/The Globe and Mail)

THE LUNCH

Bombardier's Chet Fuller: From landing airplanes to landing orders Add to ...

Chet Fuller has landed airplanes on the decks of aircraft carriers almost 400 times, so he understands a thing or two about risk.

Mr. Fuller’s days as a U.S. Navy pilot are over, and he no longer faces the peril of plunging into the waves. But now, as salesman-in-chief for Bombardier’s new C Series airplane, he is facing a different kind of danger. It’s hardly life and death, but billions of dollars and the company’s dreams of competing with larger rivals Airbus SAS and Boeing Co. are at stake.

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At Bombardier Inc., the overriding risk is whether the $3.4-billion C Series aircraft program will succeed. Determining whether the plane is a hit must wait until after 2013, when it is actually carrying passengers, but as senior vice-president of sales, marketing and asset management, Mr. Fuller’s job is critical to ensuring myriad other risks don’t wreck the program.

The $18.3-billion company by revenue is under heavy pressure from airlines to make sure the plane makes its critical first flight on schedule this December. Investors are also anxious, and hoping the C Series will generate profits and boost a stagnant stock price.

The C Series is not quite a bet-the-company proposition for Bombardier, but its failure would be a major blow to the company’s plan to move up from business jets, regional jets and turbo props into the big leagues. It would also tarnish the reputation of one of the handful of Canadian champions in the manufacturing sector, which has been battered by global competition and the soaring value of the Canadian dollar.

The question of airline orders is critical to Mr. Fuller, who is in the spotlight in part because of perceptions that Airbus and Boeing are already eating Bombardier’s lunch in the narrow-bodied segment the two giants own. That’s not so, he insists, saying the company’s strategy can be summed up in four words: “customers wide, airplanes deep.”

That means his focus is on landing at least 30 customers ordering a total of more than 300 planes by 2013, when the C Series hits the milestone known in the industry as entry into service – when it begins hauling passengers.

“As a manufacturer, we have lots of risks,” he acknowledges. “Commodities risk, labour risk, program risk, execution risk, supplier risk. The risk you can control is how many airplanes in a given horizon time you dedicate to a single airline.”

He sketches out the evidence on a napkin over a cup of tea and a bowl of pretzels and peanuts at Le Montréalais Bistrot-Bar in the Queen Elizabeth Hotel, which is perhaps better known as the site of the 1969 John Lennon-Yoko Ono bed-in for peace.

There’s something incongruous about discussing such manly topics as airplane engines and aircraft carriers while sipping tea in a hotel where they recorded Give Peace a Chance. Luckily, there are no open-faced sandwiches on pink bread in sight, few members of the blue-rinse set in the room and no one chanting “all we are saying …”

We restore our manhood later with platters of meat at Queue de Cheval Steakhouse before settling in to watch the Montreal Canadiens surrender 2-1 to the hated Boston Bruins at the Bell Centre.

The thinking behind the C Series – from Bombardier chief executive officer Pierre Beaudoin on down – is that there’s a slice of the narrow-bodied segment of the commercial jet market that demands a plane that will carry between 100 and 150 passengers.

The plane should be, the theory goes, a no-brainer for airlines because it offers 20-per-cent fuel savings and 15-per-cent lower operating costs than existing aircraft in the segment. Given soaring prices for jet fuel, airlines should be lining up to buy the plane.

So far, however, it has not been an easy sell. The orders for the plane have arrived in dribs and drabs – 11 customers with firm orders for 138 planes, and options, purchase rights and letters of intent for another 169. If those are converted to firm sales, Mr. Fuller will have his 300 planes and the plan is to land many more customers before the plane’s first commercial flight.

“First and foremost,” he says, “the goal is to get to a broad customer breadth. So we place an enormous value on small orders – five, 10, three – because it’s all about customer breadth.”

An order of 100 planes would boost the program among analysts and investors and would be more than a year’s output as production of the plane is slowly ramped up to the target of 120 a year.

But that’s too high a concentration on one customer, especially when it’s Mr. Fuller’s job to worry about a Lehman Brothers-type shock or another 9/11 and how that kind of disaster would shred an order book that depended on one customer buying 100 planes.

As one example of how things can change quickly in an industry that takes the better part of a decade to develop a new plane, AMR Corp., parent of American Airlines, is in Chapter 11 bankruptcy protection while holding orders for hundreds of Boeing 737s and Airbus A320s.

Smaller versions of those planes compete directly with the C Series. No one has any idea whether the AMR orders will be kept or scrapped or the prices slashed as the company meanders through the Chapter 11 process.

One of Mr. Fuller’s main problems in selling the plane, of course, is that Airbus and Boeing are stoutly defending the duopoly they hold in the narrow-bodied segment.

Airbus responded to C Series by offering what it calls the new engine option on its A320 family. It’s a new set of more fuel-efficient engines on an old plane, not a completely new aircraft, unlike the C Series with its lithium aluminum body and composite wings.

Boeing responded after Airbus by announcing the 737Max, which is also an upgrade to more fuel-efficient engines. Combined, the two airplane makers have announced more than 1,000 orders for the new versions of their planes.

The decisions to upgrade engines rather than develop entirely new airplanes are good for Bombardier, Mr. Fuller argues.

“What that means is we’ll have the best-in-class airplane for more than 10 years. That’s huge.”

Airbus and Boeing are, however, making it harder for him to sell the C Series for another reason. Massive delays both companies faced in getting their new wide-bodied planes to market, the A380 and 787 respectively, have made airlines skeptical that other plane makers such as Bombardier will be able to deliver their new aircraft on time.

“Because of all the delays, we often say we pay a 787 tax; the whole industry does,” he says. “Boeing’s next airplane, the 737MAX, let’s face it, is going to have a 787 tax on it. The industry is fearful of another 787-like experience and justifiably so.”

It’s a good thing for Bombardier that Mr. Fuller likes to fly because the potential market for the C Series is global.

A recent series of journeys involved two trips to Seoul, two more to Jakarta, plus flights to Singapore, Mumbai, Los Angeles and Atlanta.

He owns his own plane, a Cessna Turbo 206 and has flown the Airbus A330 and Boeing 737.

After graduating from Michigan State University with a science degree in 1982, he has spent his entire working life in aviation. He joined the U.S. Navy three days after graduating and resigned from active duty in 1996 after reaching the rank of Lieutenant-Commander.

The planes he landed on the USS Saratoga and USS Independence – among other aircraft carriers – were mainly the Grumman A6 Intruder and E2 Hawkeye, which is the navy’s airborne early-warning plane.

“I have no memory of not wanting to be a pilot. I just got my seaplane rating two years ago. Just for fun. What a blast.”

CURRICULUM VITAE

Beginnings:

Born Aug. 8, 1961

Grew up in Grand Rapids, Mich.

Bachelor of Science degree, Michigan State University

MBA in production operations and finance from Indiana University, 1998

Career:

U.S. Navy pilot and instructor

Held various senior jobs with GE Aviation civil systems before becoming president of the division.

Worked at Honeywell commercial aerospace and ATA Airlines.

Joined Bombardier in December, 2010

Personal:

Lives in Cincinnati, Ohio

Has been married for 27 years to Veronica. They have four children.

Their 23-year-old daughter and 21-year-old son are pilots. An 18-year-old son is a student pilot and they also have a 16-year-old son.

Verbatim:

We go after customers who understand the economic power of the airplane, who are technically sophisticated enough to understand the value to their network and understand that I’m going to write some guarantees around performance.

Passions:

Flying.

“Flying is an immediate release of whatever you’re thinking. You’re focusing on being a pilot. I absolutely love to fly.”

Follow on Twitter: @gregkeenanglobe

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