Bombardier signs $730M jet deal

Bombardier has won a $730-million US deal to sell 22 CRJ700 regional jets to the parent company of American Airlines.

On Thursday, AMR Corp. announced its American Eagle regional airline would order 22 of the 70-seat Bombardier planes to add to its fleet.

The airline already operates 25 of the Montreal-based aerospace giant's planes, and will add first-class cabins to its existing CRJ fleet.

Deliveries are expected to begin in mid-2010, the company said.

Bombardier shares have gained roughly 25 per cent on the Toronto Stock Exchange since the start of September.

The company wouldn't say whether the order will help it to avert additional layoffs beyond what have already been planned.  

"We can't say at this point whether there will be an impact," Bombardier spokesman John Arnone said in an interview with The Canadian Press. "The transaction is not yet finalized, and we should know more in October." 

Bombardier is in the process of laying off 4,360 employees

"This is clearly positive news for Bombardier, but does not change our view that given the still challenging outlook for the business jet market, we do not believe [Bombardier's] current share price strength  is sustainable," Versant Partners analyst Cameron Doerksen said.

Doerksen has a "sell" rating on Bombardier shares and a target price of $4.25.