Bombardier stocks have fallen this morning (January 22nd) following the company's announcement that it will be cutting hundreds of jobs.
The share price of the firm slipped after the company revealed it will be slashing 1,700 jobs from its aerospace division in a bid to cut costs.
Some 600 of the jobs are expected to be lost in the US, with the remaining positions going in Canada, a statement from the firm said.
A company spokesperson confirmed that both permanent and contract employees would be affected and the firm is not aiming to reach a specific cost-cutting target, though it would not confirm a reason why it needs to cut 1,700 jobs in total.
"This is all to do with the goal of assuring our long-term success," Bombardier spokesperson Helen Dunne told the Reuters news agency. She added: "It's just part of the overall continued focus we're putting on managing our costs prudently so that we can support our investments."
Reasons for cuts
The job losses at Bombardier come only a short time after the company revealed that its C-series model aircraft was to be pushed back to the second half of 2015.
Richard Aboulafia, vice president of aviation consultancy Teal Group, suggested that the real reason for the job losses is to raise money to spend on finishing the C-series model aircraft.
He said: "It's hard to believe that they'd be laying off this level of people without the financial necessity of doing it."
Stocks in Bombardier fell by nearly four per cent in trading on the Toronto stock exchange today on the back of the major jobs news announced by the firm. The share price of the company ended the day's trading down at 3.95, which is only slightly above the 52-week low of 3.80 that was previously reached by Bombardier.
Over the course of the last year, shares in the company have grown to as high as 5.43.
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