MONTREAL - Bombardier's (TSX:BBD.B) transportation division continues to crank out orders, providing stability and balance until the global giant's aerospace business recovers its strength.
On Tuesday, it announced that Berlin's transit operator has ordered 99 trams in a deal valued at euro300 million (C$471 million).
The first vehicles will be delivered in May 2011, and the order will be completely filled by 2017, Bombardier Transportation announced from its base in Berlin.
The order from Berliner Verkehrsbetriebe (BVG) follows a framework agreement in 2006 for up to 210 vehicles.
The trams will be produced at Bombardier plants in Germany.
Delivery of the barrier-free Flexity trams will coincide with the phasing out of the operator's 237 Tatra high-floor vehicles.
BVG said the new trams will reduce operating costs and help to attract passengers public transportation.
Analyst Chris Murray of CIBC World Markets says the order is just one of many Bombardier should win over the coming months, aided by stimulus spending in Europe and elsewhere.
"We're starting to see now some of that money come out, especially in the U.S., but you've also got other programs around the world that people will certainly be looking for money on," he said in an interview.
Bombardier's position in China should facilitate its ability to profit from the government's plans to spend more than US$500 billion on infrastructure.
The railway division's pipeline of projects is strong, with possible projects in London and Sochi, Russia, related to the 2014 Winter Olympics, he added.
Analysts expect Bombardier will report Wednesday a drop in second-quarter profits as the transportation division won't fully offset the aerospace weakness.
Earnings per share are forecast to come in at nine cents per share, down from 14 cents a year ago.
On the Toronto Stock Exchange, Bombardier shares fell 22 cents, or 5.5 per cent, at $3.78 in afternoon trading.