Bombardier plans to cut several hundred jobs at its Thunder Bay, Ont., facility, according to federal and provincial government sources.

Ontario Transportation Minister Caroline Mulroney said the provincial government has spoken to Bombardier executives "to express our disappointment that their company has taken this step."

"We urge the company to work with the provincial government to come to an agreement that would see jobs remain at the Thunder Bay plant," Mulroney said in a statement Tuesday.

A federal government source pegged the number of workers expected to be laid off at 550 — roughly half of the 1,110 who work there.

Bombardier is one of the biggest train and airplane manufacturers in the world. It is headquartered in Montreal, but has facilities around the globe.

'Difficult day'

Thunder Bay Mayor Bill Mauro called it a "difficult day" for employees and families affected by the cuts, but also for the city, where Bombardier is "by far" the largest private sector employer.

"When layoffs of this magnitude occur, you worry about the long-term viability of the plant."

Mauro said the city will do everything it can to support the plant, while continuing to "grow and diversify the economy."

However, the cuts aren't a complete surprise. David Van der Wee, Bombardier's chief operating officer for the Americas, told CBC News in June that layoffs would be coming, but said the company remained committed to the Thunder Bay operation and was actively working to secure new contracts for it.

Thunder Bay Mayor Bill Mauro says it is a 'difficult day' for workers affected by the layoffs. (Matt Prokopchuk / CBC)

Two major contracts — one producing streetcars for the Toronto Transit Commission (TTC) and one producing bi-level rail cars for the Metrolinx GO Transit service — will end at the end of 2019 and, so far, no additional contracts have been signed, Van der Wee told CBC News.

He said at the time layoffs would take effect in the fourth quarter, but did not say how many workers might be affected.

TTC spokesperson Stuart Green said Bombardier still owes Toronto 38 streetcars by the end of this year, but said the transit commission has no reason to believe the layoffs will affect the delivery schedule.

Bombardier promised Toronto a total of 204 streetcars, 166 of which have been delivered to date, Green said. Toronto's streetcars are made in Thunder Bay and at another plant in Kingston, Ont.

Union calls for new contracts

Local union president Dominic Pasqualino said employees knew cuts were around the corner, but "it's disappointing when the reality hits."

He said he fears more job losses are on the horizon as the current contracts wind down.

"We've been working very hard in the last year or two. We've been delivering our cars on time. The quality is up," Pasqualino said.

He expressed hope that the provincial and federal governments will work together to get a new contract signed, to keep workers in Thunder Bay employed.

"Every day that they don't sign something means another day for my people to be laid off," he said.

Dominic Pasqualino, president of Unifor Local 1075, represents workers at the Bombardier plant in Thunder Bay, Ont. He says the cuts won't be a shock to workers, but the decision is still 'disappointing.' (Nicole Ireland/CBC)

Pasqualino partly blames the plant's lack of new contracts on U.S. President Donald Trump's administration, which has backed "buy America"-like clauses that prioritize work done in the U.S.

That makes things tougher for Canadian plants, said Karl Moore, a professor of business strategy at McGill University in Montreal.

If Bombardier wants to save Canadian jobs, it needs "to have orders from companies in Canada or elsewhere, but not the U.S.," Moore said.

On the other hand, Bombardier in June announced plans to open a new rail car assembly plant in California, which makes it easier to take U.S. contracts, he said.

Last month, Kenora–Rainy River MPP Greg Rickford said Ontario's regional transportation agency, Metrolinx, extended an offer for 36 additional rail cars to Bombardier, but Pasqualino says the plant needs 10 times that amount to sustain employment.

Metrolinx has also given Bombardier the option to slow down production of the 63 remaining rail cars slated for completion by year's end.

A Bombardier spokeswoman declined to comment.