Canada says Bombardier talks focus on research, jobs, headquarters

[OTTAWA] Canada will not give struggling aircraft maker Bombardier Inc federal aid without assurances on jobs, investment in research and the location of the company's headquarters, a senior government official said on Wednesday.

The two sides are still far apart on reaching a deal on the firm's request for US$1 billion to support its new CSeries passenger jet, say well-placed sources.

Innovation Minister Navdeep Bains, who is in control of the negotiations, told reporters the two sides were still talking and - for the first time - he revealed some of the details. "We're focused very much on R and D (research and development) investment in Canada, the fact that the C Series continues to be ... produced here in Canada, that the head office remains here. It's about good-quality jobs," he said.

"It's about the long-term success of the company and the sector ... We want a strong, vibrant aerospace sector in Canada, and that is a priority for this government."

Bombardier's 18,000-strong workforce in the province of Quebec is largely aerospace-focused and its presence helps support many smaller part vendors and suppliers in the region.

Sources familiar with the negotiations say Ottawa is demanding certain performance guarantees from the firm and could walk away from the talks.

The federal government is also concerned by the company's dual class share structure, which has been criticised by investors and analysts.

The structure gives the Bombardier-Beaudoin family effective control over the firm. Critics say this means it is hard to push through needed reforms.

Mr Bains declined to answer when asked whether Ottawa wanted Bombardier to scrap the structure.

REUTERS