Bombardier signs $700m IBM cloud deal to support business turnaround efforts

Canadian vehicle manufacturer inks IBM cloud deal to support five-year push to cut costs and improve efficiency

Bombardier has signed a six-year cloud deal worth $700m with IBM, as the Canadian plane manufacturer banks on digital transformation to turn around the company’s fortunes.

The deal will see IBM assume responsibility for managing the bulk of Bombardier’s worldwide IT infrastructure and operations under the terms of a service management contract spanning 47 countries.

The partnership marks an extension of Bombardier’s existing relationship with Big Blue, and is set to pave the way for the vehicle manufacturer to accelerate its shift to the cloud.

Martin Jetter, senior vice-president of IBM Global Technology Services, said the organisation is looking forward to forging even closer ties with Bombardier and supporting its pursuit of future growth opportunities.

“Bombardier’s global decision to extend its existing partnership with IBM and move to IBM Cloud is recognition of our broad expertise and experience helping clients transform the business of IT to be more competitive, agile and secure through cloud computing and industry services best-practices,” added Jetter.

Sean Terriah, aerospace and corporate office CIO at Bombardier, said the move to cloud will underpin the organisation’s five-year turnaround plan, which began in earnest in 2016 and is focused on rebuilding the company’s earnings growth potential.

As such, the plan is geared towards improving the company’s productivity and cutting costs, as it strives to achieve recurring savings of $300m by the end of 2018, and has already seen the company take steps to streamline its operations from a headcount and production perspective.

“As part of our turnaround plan, Bombardier is working to improve productivity, reduce costs and grow earnings. This IT transformation initiative will help us better integrate globally to create a best-in-class IT organisation,” said Terriah.

“With IBM, we will transform our service delivery model to focus on our core competencies, and leverage the best practices of our strategic partner across our infrastructure and operations.”

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