Bombardier Inc. is in preliminary talks to sell a stake in its troubled CSeries jet program to Airbus Group SE, according to a person familiar with the matter.

The talks, first reported by Reuters, come at a time as the Canadian plane and train maker has burned through cash amid declining profits and struggles to launch the CSeries, which would compete with the smaller passenger jet offerings from Airbus and Boeing Co.

Bombardier is considering a range of strategic initiatives, including new financing and assets sales, to shore up its balance sheet. The company has already said it would sell a minority stake in its train-equipment business.

Bombardier raised about $3 billion in debt and equity earlier this year. Its stock, which jumped 15% in Toronto trading on Tuesday, is down 57% year to date.

A CSeries stake sale would enable Bombardier to lean on financially stronger Airbus to help finance marketing of the CSeries. Bombardier has been slow to lock in new orders for the plane in recent months, raising questions about the program's success.

For Airbus, an equity stake in the CSeries would allow the European jet maker to share in the revenue generated from sales of the CSeries jets without incurring the heavy upfront costs to develop the program.

After many delays, the CSeries 100 is expected to begin flying commercially in the first half of 2016. Bombardier has touted the aircraft's fuel efficiency and lower operating costs as key advantages over rival aircraft. The smaller CSeries 100 model seats up to 125 passengers, while the CSeries 300 seats up to 160.

Bombardier has said it expects more customers to sign up once it gets full certification of the jet program, on track to be completed by the end of the year.

Bombardier is currently in talks to sell the CSeries jet to United Continental Holdings Inc.'s United Airlines, JetBlue Airways Corp. and Air Canada, according to the person familiar with the matter.

Last month, Bombardier said it had booked orders and commitments for 603 CSeries aircraft, which included firm orders for 243.

Jacquie McNish contributed to this article.

Write to Ben Dummett at ben.dummett@wsj.com

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(END) Dow Jones Newswires

October 06, 2015 18:55 ET (22:55 GMT)

Copyright (c) 2015 Dow Jones & Company, Inc.
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