Bombardier Finance Inc.: A Supporting Arm

Bombardier Finance Inc. (BFI) served as the financial services arm of Bombardier Inc., a global transportation company known for its business jets and rail transportation systems. Though no longer an active entity since its wind-down in 2021, BFI played a crucial role in facilitating the sales and leasing of Bombardier products to its customers. Its primary function was to provide tailored financing solutions, ensuring that customers could access the necessary capital to acquire Bombardier's high-value assets.

The importance of BFI stemmed from the capital-intensive nature of Bombardier's products. Business jets and rail cars represent significant investments, often beyond the immediate reach of many potential customers. BFI addressed this challenge by offering a range of financial products, including:

• Loans: Direct lending to customers for the purchase of Bombardier aircraft and rail equipment.
• Leases: Operating and finance leases, allowing customers to utilize Bombardier assets without the upfront capital expenditure of ownership.
• Residual Value Guarantees: Reducing risk for lessors by guaranteeing a minimum value for the asset at the end of the lease term.
• Structured Finance: Complex financing arrangements tailored to the specific needs of individual customers and projects.

By providing these financing options, BFI effectively acted as a sales enabler for Bombardier. It expanded the potential customer base, allowing companies and individuals who might not otherwise be able to afford Bombardier products to access them. This, in turn, contributed to Bombardier's overall revenue and market share.

Furthermore, BFI played a vital role in managing the financial risks associated with the leasing and financing of large assets. It possessed expertise in asset valuation, credit risk assessment, and portfolio management. This allowed Bombardier to offer competitive financing terms while mitigating potential losses.

However, challenges within Bombardier Inc. ultimately led to the winding down of Bombardier Finance Inc. The parent company underwent significant restructuring, divesting various business segments to streamline operations and reduce debt. As part of this strategic shift, Bombardier decided to exit the financial services business. While BFI is no longer operating, its past contributions to Bombardier's success remain significant, demonstrating the value of a dedicated financial services arm in supporting the sales and growth of a large industrial manufacturer. The functions previously performed by BFI are now handled by other institutions, either directly by the customers or through third-party financing arrangements.