Business jet market drivers · Source : Bombardier Business Aircraft Market Forecast 2011-2030...

2

September 2011

This presentation includes forward-looking statements. Forward-looking statements generally can be identified by the use of

forward-looking terminology such as “may”, “will”, “expect”, “intend”, “anticipate”, “plan”, “foresee”, “believe” or “continue”, the

negative of these terms, variations of them or similar terminology. By their nature, forward-looking statements require us to

make assumptions and are subject to important known and unknown risks and uncertainties, which may cause our actual

results in future periods to differ materially from forecasted results. While we consider our assumptions to be reasonable and

appropriate based on information currently available, there is a risk that they may not be accurate. For additional information

with respect to the assumptions underlying the forward-looking statements made in this presentation, refer to the respective

Forward-looking statements sections in BA and BT in the MD&A of the Corporation’s annual report for fiscal year 2011.

Certain factors that could cause actual results to differ materially from those anticipated in the forward-looking statements

include risks associated with general economic conditions, risks associated with our business environment (such as risks

associated with the airline industry’s financial condition), operational risks (such as risks involved in developing new products

and services, risks in doing business with partners, risks relating to product performance warranty and casualty claim losses,

to regulatory and legal proceedings, to environmental and health and safety, to our dependence on certain customers and

suppliers, to human resources, to fixed-price commitments and to production and project execution), financing risks (such as

risks relating to liquidity and access to capital markets, to the terms of certain restrictive debt covenants, to financing support

provided on behalf of certain customers and to reliance on government support) and market risks (such as risks relating to

foreign currency fluctuations, to changing interest rates and commodity prices risks). For more details, see the Risks and

uncertainties section in Other in the MD&A of the Corporation’s annual report for fiscal year 2011 .Readers are cautioned that

the foregoing list of factors that may affect future growth, results and performance is not exhaustive and undue reliance should

not be placed on forward-looking statements. The forward-looking statements set forth herein reflect our expectations as at the

date of this presentation and are subject to change after such date. Unless otherwise required by applicable securities laws, the

Corporation expressly disclaims any intention, and assumes no obligation to update or revise any forward-looking statements,

whether as a result of new information, future events or otherwise.

All amounts are expressed in 2011 U.S. dollars unless otherwise stated

Forward-looking statement

3

Business jet market drivers

4

The business aviation value proposition

An increasingly global and

competitive business environment

requires customized travel solutions

Business aircraft provide an optimal

working environment in a private

setting

Business aircraft offer substantial

time-savings and productivity

benefits

Activities of business jet owners

contribute significantly to economic

growth

5

Long-term business aircraft market drivers remain solid

Market Driver 10-Year Outlook Outlook

Globalization of

Trade

As trade barriers fall and global mobility increases, the business

community requires flexible travel means like business aviation to

efficiently link all workplaces and drive economic growth.

Emerging

Markets

Accelerated wealth creation coupled with aviation infrastructure

development should help business jets penetrate emerging markets.

New aircraft

programs

New aircraft programs stimulate demand. There are numerous aircraft in

development scheduled for potential entry into service over the next

decade.

Replacement

demand

With a worldwide installed base of over 14,700* aircraft and average

aircraft replacement occurring 5 to 10 years after initial delivery, the

market should continue to show vitality.

* Excluding very light jets and large corporate airliners

6

52%

72%67%

58%53%

43%

35%

29%33%

38%

10%

9% 19%

15%

19%

17% 30%

34%32% 23%

11%

6%

3%

6% 8%

12%

10%11% 10%

7%

4% 2%

3% 5%

6%4% 6% 5%

10%

7%2%

3% 1%

3%4% 2% 4%

1%

1%

2%

8% 8%11%

9%7% 7%

1%

0%

2% 2%2%

1%

2% 2%0%

0%1% 2%

2% 1%1%

2% 2%8%

1% 3% 3%5% 6% 4% 6% 5%

6%

6%

4%

6%

9%

4%

7%

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Asia Pacific

India

China

Russia & CIS

Africa

Middle-East

Latin America

Europe

North America

BUSINESS JET INDUSTRY GROSS ORDERS

Units, % of world total, 2001-2010

International markets are the source of most orders,

with Asia accounting for a greater share in 2010

Source: Bombardier analysis based on OEM disclosures, excluding very light jets and large corporate airliners

7

44

Source: IHS Global Insight, November 2010

2010 WORLD REAL GDP GROWTH

> 6%4 to 6%2 to 4%0 to 2%< 0%

+3.8%+3.8%WorldWorld

Global Economic ActivityThe world’s strongest economic growth continues to be in Asia

Source: IHS Global Insight, Feb. 2010

2010 WORLD REAL GDP GROWTH World % Growth +3.8%

8

Pre-owned business jet inventories are improving,

scarcity now occurring in the Large size category

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%

Q2

08

Q3

08

Q4

08

Q1

09

Q2

09

Q3

09

Q4

09

Q1

10

Q2

10

Q3

10

Q4

10

Q1

11

Q2

11

Light

Medium

Large

15.2%

12.7%

6.1%

Historic

Average

Range

PRE-OWNED INVENTORY BY SIZE CATEGORY % of fleet, Q2-2008 - Q1-2011

9

Buenos Aires

Miami

Detroit Toronto

Boston

Atlanta Los Angeles

Dallas

Moscow

San Francisco

Philadelphia Osaka Seoul

Shanghai

Hong Kong

Wash.

New York Chicago

London

Tokyo

Mexico City

Paris

2025 GDP in $bn

400 2000

Seattle

Sao Paulo

Rio de Janeiro

Beijing

Delhi Guangzhou

Mumbai

Houston

TOP 25 CITIES IN TERMS OF GDP IN 2025

Over the next 15 years, the emergence of China and India should

translate in stronger demand for long-range aircraft

Newly IN

Newly OUT

Source: PriceWaterhouseCoopers UK Economic Outlook November 2009

10

China experienced a rapid increase in business jet

deliveries during 2010

0

10

20

30

40

50

60

2006 2007 2008 2009 2010

CHINA

INDIA

REST OF ASIA PACIFIC

Source: Ascend. Excludes very light jets and large corporate airliners

BUSINESS JET DELIVERIES

Units

11

182

107

72 7262

4936 4

428

192178

11695

86

56 53

427

6

0

100

200

300

400

500

North

America

Europe China Russia &

CIS

Asia exc

China

Middle

East

India Latin

America

Africa

2010

2011

NUMBER OF BILLIONAIRES Unit & % Change 2010-2011

Sources: Forbes.com February 2010 and March 2011.

Number

of

Billionaires

% Change

2011 vs 2010 0% 5% 66% 61% 32% 39% 14% 47% 50%

World 2010: 1,011

World 2011: 1,210

China is experiencing a dramatic increase in the number

of billionaires in 2011

12

Business jet market forecast 2011-2030

Download the entire 2011 Business Aircraft Market Forecast at www.bombardier.com

13

0

200

400

600

800

1000

1200

1400

1600

91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

BUSINESS JET INDUSTRY 20-YEAR DELIVERIES OUTLOOK Units, calendar years, 1991-2030

Source : Bombardier Business Aircraft Market Forecast 2011-2030

1991-2000

3,600 units

2001-2010

6,400 units

2011-2020

10,000 units

2021-2030

14,000 units

Worldwide business jet historic and forecast deliveries

14 Source: Bombardier forecast

INDUSTRY REVENUES BY CATEGORY

$US billion, Constant 2010, Forecast 2011-2030

INDUSTRY DELIVERIES BY CATEGORY

Units, Forecast 2011-2030

30 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11

0

500

1,000

1,250

750

250

1,500

30 29 28 27 26 25 24 23 22 21 20 19 18 17 16 15 14 13 12 11

40

35

30

25

20

15

10

5

0

Units Value

24,000

11,000

7,750

5,250

$626B

$130B

$236B

$260B

Total 20 Yrs

Large

Medium

Light

24,000 business jet deliveries worth $626 billion forecast

worldwide over the next 20 years

15

China will become the 3rd largest market for business jet

deliveries

Source: Bombardier Business Aircraft Market Forecast 2011

Total World

2011-2020 10,000

2021-2030 14,000

15

16

14,700

21,600

30,900

10,000

14,000

3,100

4,700

Fleet 2010 Deliveries Retirements Fleet 2020 Deliveries Retirements Fleet 2030

World fleet forecast to grow to 30,900 by 2030, CAGR1 of 3.8%

WORLD FLEET EVOLUTION FORECAST

Fleet, Deliveries, Retirements; 2010-2030

Sources: Ascend, Bombardier forecast. Excludes very light jets and large corporate airliners

Note: 1 CAGR = Compound Annual Growth Rate

17

China and India will move up the ranks in terms of

business jet fleet size by 2030

WORLDWIDE DISTRIBUTION OF A/C

FLEET IN 2010

350

380

380

1,400

1,800

9,700

110

150

320

India

China

Africa

Asia Pacific

Middle East

Russia & CIS

Latin America

Europe

North America 66%

12%

10%

3%

3%

2%

% of

Fleet

1%

1%

WORLDWIDE DISTRIBUTION OF A/C

FLEET IN 2030

950

1,145

1,400

1,415

1,765

2,470

2,735

5,190

Africa

Asia Pacific

India

Middle East

Russia & CIS

China

Latin America

Europe

North America

3%

45%

17%

9%

6%

5%

5%

% of

Fleet

4%

3%

8%

Total Fleet Size of 14,700 Total Fleet Size of 30,900

Source: BBA market forecast

CAGR: 6%

CAGR: 6%

CAGR: 14%

CAGR: 7%

CAGR: 8%

CAGR: 15%

CAGR: 3%

CAGR: 5%

CAGR: 2%

18

1

10

100

1000

10000

100 1,000 10,000 100,000

GDP per Capita (USD, Log Scale)

Fle

et

pe

r 1

00

Millio

n P

op

ula

tio

n (

Lo

g S

ca

le)

2nd driving

force:

removal of

barriers

1st driving

force: GDP

growth

NORTH AMERICA

LATIN AMERICAEUROPE &

RUSSIA

ASIA

MIDDLE-EAST &

AFRICA

Average

growth path

PENETRATION RATES BY REGION

Fleet per Capita vs. GDP1 per Capita, 1960-2010

Source: Fleet from Ascend, GDP and Population from IMF

Our market forecast is based on regional penetration rates

NORTH AMERICA

LATIN AMERICA

MIDDLE-EAST &

AFRICA

ASIA

EUROPE &

RUSSIA

1st driving

force: GDP

growth

2nd driving

force:

removal of

barriers

Average

growth path

Note: 1 GDP = Gross Domestic Product

19

1

10

100

1000

100 1,000 10,000 100,000


Fle

et

pe

r 1

00

Mill

ion

Po

pu

lati

on

(L

og

Sc

ale

)

Actuals

Forecast

Sources: Ascend, IMF, IHS Global Insight, UN population project,

Bombardier forecast, including very light jets

WORLD BUSINESS JET PENETRATION FORECAST

Fleet per capita vs. GDP1 per capita, Actual 1960-2010, Forecast 2011-2030

Business jet penetration will continue worldwide

20-year CAGR2 = 3.8%

20-year fleet per million population = from 260 to

460 aircraft per 100 million in population

Note: 1 GDP = Gross Domestic Product 2 CAGR = Compound Annual Growth Rate

20

1

10

100

1000

10000

100 1,000 10,000 100,000


Fle

et

pe

r 1

00

Millio

n P

op

ula

tio

n (

Lo

g S

ca

le)

JAPANEMERGING ASIA

OCEANIA

BUSINESS JET PENETRATION FORECAST – ASIA PACIFIC

Fleet per capita vs. GDP per capita, 1960-2030

Sources: Ascend, IMF, IHS Global Insight, UN population project, Bombardier forecast. Includes very light jets

Business jet penetration rates vary within the Asia region

21


150

1,100960

10

30

2,470

1,400


FLEET EVOLUTION FORECAST – CHINA


China will lead the world in business jet fleet growth rate;

15% CAGR with 2,360 business jet deliveries 2011-2030

22

Bombardier has progressively increased its forecast for

China to reflect current market dynamism and progress

Bombardier's 10-year China

business jet delivery

forecast over last the past

three years

300

600

960

2009 2010 2011

Edition of Business Aircraft Market Forecast

Key Market Size Limitations

I. Airport Access

II. Airspace Restrictions

III. Airport Ramp Space

IV. Taxes

V. Greater use as a “Company”

aircraft

x2

+60%

Changes in market limitations significantly impact

China’s potential business jet fleet size

23

110

10

30

1,400

485

945

385


FLEET EVOLUTION FORECAST – INDIA



India will have the second highest business jet fleet growth

rate; 14% CAGR with 1,330 business jet deliveries 2011-2030

24


350

660

370

60

120

1,145

605


FLEET EVOLUTION FORECAST – REST OF ASIA PACIFIC


Rest of Asia Pacific will have a solid business jet fleet growth

rate; 6% CAGR with 975 business jet deliveries 2011-2030

25

Bombardier Business Aircraft

26

LEARJET 40 XR LEARJET 45 XR LEARJET 60 XR

GLOBAL 6000

With 12 programs, Bombardier has the industry’s

strongest product portfolio

LEARJET 85

GLOBAL 7000 GLOBAL 8000 GLOBAL 5000

CHALLENGER 300 CHALLENGER 605 CHALLENGER 850 CHALLENGER 870

27

8% 8% 8% 8%

13%18%

9%

31% 31% 32% 31%

22%16% 19%

17% 15% 13% 14% 14%12% 8%

7% 9%4%4%3%

0%

25%

50%

75%

100%

Delivery

Market Share (%)

YTD ’11 ’10

28%

19%

’09

16%

3%

’08

26% 30%

17%

’07

27%

16%

27%

15%

’05

28%

13%

’06

3%

22%

33%

World Delivery Market Share World Revenue Market Share

11% 12% 13% 13%20%

25%

14%17% 17% 17% 17%11%

6% 7%9% 8% 7% 8% 8% 6% 4%

4% 4% 5% 5% 4%

0%

25%

50%

75%

100%

’05

31%

27%

’07

30%

27%

’06

32%

27%

Revenues

Market Share (%)

YTD’11 ’10

35%

25%

3%

’09

32%

26%

3%

’08

31%

27%

35%

36%

Bombardier is the worldwide business jet industry leader;

In China, we have 53 business jets in service and 29% market share

Sources: GAMA and B&CA list price; Excluding VLJ’ & Mega Large, updated

to Q2 2011. Ascend for China market data, as of June 30, 2011

* *

* 2010 & 2011Deliveries as per IFRS * 2010 & 2011 Revenues as per IFRS

28

President Hu Jintao visits Bombardier in Toronto – June 2010

29

2008 Today 2013

Regional Support Offices 5 7 14

Parts distribution centers /

depots total Data non

available

$ 66

$499

13

BBD Service Centers 7 9 10

Authorized Service Facilities 47 51 62

Training Centers 13 sims 17 sims 23 sims

We are expanding our Customer Services network in Asia BOMBARDIER 2013 NETWORK

THE AMERICAS EUROPE/ME/AFRICA ASIA

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Summary

Asia is now the key growth market for business jets

Over 5,600 business jet deliveries forecast into the entire region, 2011-2030

23% of forecast World deliveries

China moves to the number 1 position in terms of business jet fleet

growth rate and number 3 in terms of total deliveries, 2011-2030

India will also grow strongly, with solid growth for the rest of Asia

Continued advancement in infrastructure and regulatory policy

required to make the forecast a reality

Bombardier has a strong presence here and is investing heavily in

this market

Thank you! Questions?

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