Canadian aerospace company, Bombardier, has developed a new larger series of single aisle aircraft (its Cseries) designed to compete with the Boeing 737 and Airbus A320, but the aircraft is 2 years behind schedule and its parent company is having significant financial difficulties.
In a controversial move, the Quebec government has invested (and risked) $1 billion USD of taxpayer money on the aircraft. Provincial leaders justified the gamble by saying Bombardier is too important to fail. The government calls it an investment in keeping good jobs in the province and to keep its tax revenues alive. Quebec's aerospace industry supports 40,000 jobs.
Bombardier, grateful for this cash infusion, said the taxpayer money was necessary to reassure markets the company has a future and provides enough cash-flow to remain viable, at least for now.
The province's cash infusion is not a loan, but "an investment". The Quebec government will own 49.5% of the company responsible for the CSeries aircraft. Government opposition critics say that as the investment is only in the risky and struggling branch of Bombardier, the money is at risk and that the government should have insisted in a share of the profitable sectors of the company.
More on this story from thestar.com at this link.