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Quebec’s political leaders are voicing growing concern about Bombardier Inc. as speculation builds that the debt-laden company is moving toward a sale of either its train unit or private jet business, which employs thousands in the province.

Premier Francois Legault is “personally involved” in Quebec’s evaluation of Bombardier’s circumstances and whether the province should do anything in response, spokesman Ewan Sauves said by e-mail from Davos, Switzerland, on Tuesday, where senior government officials are attending the World Economic Forum annual meeting.

“We are concerned about the situation at Bombardier,” Mr. Sauves said, adding that concern extends across the company’s operations.“We’re still thinking and weighing our options.”

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The tone used by the Premier and his staff Tuesday was more urgent than the day before, signaling the government is worried that an asset sale could have a dramatic impact on employment. Bombardier employs roughly 10,100 people working on private jets in Quebec and 1,300 people in its train division in the province.

Montreal-based Bombardier last week slashed its financial estimates for 2019 again as it continues to struggle to complete train contracts and also said it may pull out of a joint venture with Airbus SE, undermining investor confidence in management and shredding its market capitalization by about one-third to $3-billion. The company also said it was “actively pursuing options” to strengthen its balance sheet and “solve” its capital structure.

Bombardier’s only option to dig itself out from under the weight of its $9-billion-plus debt load is to monetize one of its two remaining businesses, National Bank of Canada analyst Cameron Doerksen said in a note published Tuesday. And despite the potential blowback from government, selling the private jet business is the best choice of the two, he said.

“We believe management is already pursuing a divestiture” of either the aviation or train business, Mr. Doerksen said. “We see a sale of aviation as less likely to face any lengthy regulatory reviews for competition issues, but a deal could face opposition on other fronts. Most notably, [the aviation business] is a major employer in Canada and Quebec in particular, so a sale could result in consternation amongst political leaders and employees.”

Quebec considers aerospace a strategic industry for its economy and Bombardier to be one of the sector’s main anchors. The previous Liberal government of Philippe Couillard invested US$1-billion for a 49-per-cent stake in Bombardier’s former C Series aircraft in 2016 to prevent the company from veering towards collapse. Its participation in the joint venture, now controlled by Airbus, has since fallen to 16.4 per cent.

Mr. Legault’s government has to decide whether to invest more public money in the venture or risk seeing its share diluted further.

Bombardier executives have often said that the steadier cash-flow generation of the Berlin-based train unit, known as Bombardier Transportation ([BT), offsets its private jet business, which is exposed to the swings of economic cycles. BT’s customers are typically governments or public transportation entities.

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That steadiness makes the train unit the better standalone business to keep, according to Mr. Doerksen. While BT might attract more potential buyers, Bombardier “can’t afford to wait” for the outcome of a lengthy review by regulators, he said, adding it took the European Commission 17 months to reject a proposed merger between France’s Alston SA and Siemens AG.

BT’s order book currently stands at about US$36-billion. Its growth should benefit from global trends towards more environmentally friendly transportation solutions as the world’s population is increasingly urbanized, Moody’s analyst Jamie Koutsoukis has said.

Once a powerful Canadian name in global manufacturing, Bombardier today is a shadow of its former self.

In addition to cutting thousands of jobs since 2015 under a turnaround plan led by chief executive Alain Bellemare, it has also sold its flight training business to CAE for net proceeds of about US$500-million and its turboprop plane business to Longview Aviation Capital Corp. for US$300-million. A deal to sell its CRJ regional jet unit to Mitsubishi Heavy Industries Ltd. for US$550-million in cash and the assumption of US$200-million in debt is expected to close this year.

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