Hon. John P. Manley, Former Minister of Industry and Finance.
Many Canadians might not know it, but over the past year one of our global industrial champions has faced an unprecedented level of geopolitical challenges. And here’s the amazing part. This Canadian business came out on top. Not once, but twice. It’s a story that all Canadians can be proud of and one that few in the business media saw coming.
By the time Alain Bellemare took over the leadership of Bombardier in 2015, overaggressive aerospace investments had sent the storied Canadian company toward the verge of bankruptcy. Although Mr. Bellemare had an impressive track record in the industry from his many years at United Technologies, pessimism about the company was nearly unanimous.
On top of that, it seemed as if every day brought more bad news. A daily flood of media reports highlighted the steep climb Bombardier faced in both its aerospace and rail businesses.
Competitors had the knives out, too. Boeing had filed a trade case with the Trump administration that aimed to cripple the CSeries program before it had a chance to gain a foothold in the marketplace. Then, Bombardier’s two fiercest competitors in the train business, Siemens and Alstom, announced plans to merge their rail operations to create a heavyweight competitor that could dominate by sheer size.
In each situation, Bombardier seemed at a deep disadvantage. Boeing filed its case in the most hostile forum imaginable, the U.S. Commerce Department’s International Trade Commission, at a time when protectionism was at a fever pitch south of the border. Meanwhile in Europe, Siemens and Alstom enjoyed the strong support of French President Emmanuel Macron and Germany Chancellor Angela Merkel, who hailed the merger as the next European giant à la Airbus, or a sort of “Railbus” for trains.
Commentators seized on those events as signs that a gloomy future awaited Canada’s iconic industrial company. “Bombardier left out in the cold,” one national headline shouted when the Siemens-Alstom deal was announced. These “bruising threats imperil Bellemare’s effort to reshape Bombardier” warned another.
There was no shortage of grim metaphors, and skepticism about that prevailing narrative was all but absent. As it turns out, some sober analysis would have been helpful: the dire predictions were badly mistaken.
In both cases, the expert prognosticators had underestimated Mr. Bellemare and the team he has assembled. Boeing’s case was thrown out after Bombardier made a principled and vigorous public rebuttal. And now the European Union has vetoed the proposed rail merger for how it would undermine competition in the market.
The fact that Bombardier was successful in both cases was more than just good luck. Rather, it reflects the swift and skillful work by team Bombardier, which rallied stakeholders, built persuasive coalitions and made compelling cases in both Washington and Brussels. Oh, and one more thing – they had the composure to stay cool-headed when others were panicking.
Canadians should also recognize how our government stood behind Bombardier and stood tall for the rule of law and fair competition in both cases. The attention, credibility and moral conviction Canada’s leaders brought to these disputes helped ensure that their foreign counterparts steered the right and ethical course. They, like Bombardier, didn’t shrink from the challenges. It was certainly the right thing to do, because this also meant defending Canada’s manufacturing and technological sector. The success of Bombardier is vital to the Canadian economy, with the firm’s extensive operations and supply chain impact all across the country.
The jury is still out on whether Bombardier can complete its ambitious financial turnaround on time, although most analysts seem to be placing their bets on success. However, one thing has become crystal clear: This team should never be counted out. While in the midst of rebuilding a complex global organization, this Canadian company has shown it can win big games on the road against seeming long odds. I for one would not bet against them.