Bombardier's big news, Saks Canadian launch and the loonie stays low: BUSINESS WEEK WRAP
The week began with good news and bad news for Bombardier. The company inked a deal with Air Canada to buy 45 of the planemaker's next generation CSeries jets in a deal that could be worth almost $4 billion.
It's the first time Bombardier has been able to sign a deal with a major North American carrier for its jets, and the main reason why the shares rebounded so strongly, up 16 per cent to above the critical $1 a share level for the first time in more than a month.
But it came with the bad news that the company is going to lay off another 7,000 people from its 60,000-strong global workforce as it seeks to cut costs until the CSeries can start paying off.
None of the job cuts will come from the commercial aircraft unit that includes CSeries, and one watcher told us this week that's because the project is now critical to the company's survival.
"They need a lot more orders," McGill University professor Karl Moore said, "but this will give them greater sales impetus and give them greater credibility."
Saks comes to Canada
Another big story of the week was the arrival of high-end retail chain Saks Fifth Avenue, which made its Canadian debut on Thursday when it opened its first store in downtown Toronto.
Saks is hoping to learn from others mistakes and make money while taking on new upscale rivals like Holt Renfrew and Harry Rosen, not to mention their traditional foe, Nordstrom, which already has three stores in Canada.
Judging by the price of the goods on offer, it's clear Saks is catering to a high end of the market. But one retail analyst questions whether there's enough of that market to go around.
"How many of these stores do you need?" retail consultant Bruce Winder said. "What's the density? Is there too many stores or not enough."
"Certainly they'll make money on this store," he said, "but it may take a couple of years to pay back."
Loonie keeping Canadians at home
Our cheap dollar is making Canadians think twice about travelling to the U.S.
Trips by Canadians to visit our southern neighbour, fell by more than 20 per cent in December, compared to the same time a year earlier.
Same-day car trips were the driving factor, down 25 per cent in a time when the loonie was also down by a significant amount.
For some perspective, it cost about $1.17 Canadian to buy a U.S. dollar in December 2014. By December of 2015, that had risen to about $1.38.
With inflation like that, it's no wonder so many former cross-border shoppers are now staying north.
RRSP deadline nears
And finally, consider this your official reminder that the RRSP deadline is fast approaching. Feb. 29 — a mere 10 days away at press time — is the deadline to make RRSP contributions that will be eligible for the 2015 tax year.
As usual, we have produced an extensive collection of stories that should give you everything you need to know to make an informed decision. Read all our comprehensive coverage here.
In the meantime, here's a day-by-day list of our most read stories of the week.
- From banks to Uber — no competition please. We're Canadian
- Fort McMurray and the Canadian boom to bust experience
- Apple's Tim Cook blasts order to unlock iPhone, vowing to fight court order
- Paypal cuts off another unblocking service amid Netflix crackdown
- ANALYSIS Is Bombardier a no brainer investment or a house built on quicksand?
- Low Loonie keeping Canadians from travelling to the U.S.