Embraer stages Rio spectacle while promising smoother jet production

Embraer one-upped the ceremonies with its Christ the Redeemer show before the Iata annual general meeting got down to business.

High jet fuel prices stemming from the Strait of Hormuz upheaval briefly eclipsed more persistent issues: aircraft backlogs, allegedly onerous regulations, supply chain logjams, and the crawl to getting more sustainable aviation fuel in the system.

Iata director-general Willie Walsh slammed engine manufacturers, and said he enjoyed complaining about them, because someone had to do it, and many airline bosses were scared of doing so.

Despite the Iran war, the frequently pilloried European Union bureaucracy, and Walsh’s displeasure at engine-makers’ profit margins, the overall mood was defiant, even sometimes optimistic. After all, the industry just six years ago might have seemed on the verge of annihilation when Covid hit.

Afterwards, Embraer hosted a trip on an E2 jet to São José dos Campos. It’s a city not big by Brazil standards but still home to about 700,000 people. It looks close to Rio de Janeiro on the map but is nearly 400km away.

Embraer’s factory, or campus, is a small city of its own in São José, with more than 10,000 employees at the site, its own runway, and multiple hangars.

The company was established in the 1960s, became a successful exporter, and stands out in a country where commodity exporters dominate.

Embraer has had some success filling niches, especially for commercial jets up to 150 seats, rather than always trying to compete directly with Boeing or Airbus. But we’re shown stages of the aircraft assembly process for Embraer’s E195-E2, a member of the E2 family which competes with the Airbus A220.

These aircraft are more often described as small narrowbodies, rather than regional jets. The A220 has five-abreast seating and the E195 has four-abreast. The new Embraer models seat 120 to 146 people and have ranges of 3000 nautical miles, or 5556km. If flying out of Auckland, then most of Australia including Adelaide and Darwin would be within reach, as would Tahiti.

As we move through one hangar, the company for the first time reveals a brand new Latam Airlines E195.

Embraer aircraft at the aerospace company’s São José dos Campos plant in Brazil. Photo / John Weekes

In many parts of the campus, photography is forbidden, presumably for commercial sensitivity or anti-corporate espionage reasons. But Embraer and the airline were both keen to show off the new aircraft, which is for the subsidiary Latam Airlines Brazil.

We also saw a new aircraft for South African airline Airlink, one for Azul Brazilian Airlines, which is based in São Paulo about 120km away, and another for Luxembourg’s Luxair.

Embraer has distinct commercial aviation, business aviation and defence business units.

The Brazilian company brought its KC-390 to New Zealand in 2017.

Australian Aviation magazine said that was part of a bid to woo the Royal New Zealand Air Force, at the time looking to replace the C-130 Hercules and P-32K Orion maritime surveillance aircraft.

Embraer’s KC390 military transport plane. Photo / Supplied

New Zealand ended up opting for a Lockheed Martin C-130J Hercules and Boeing P-8A Poseidon. You can’t win all the campaigns.

Embraer’s commercial aviation headquarters are in Amsterdam and the company has important offices in Florida and other places but more staff in São José dos Campos than anywhere else.

“We have today over 2000 e-jets in operation across six continents,” Embraer chief executive Francisco Gomes Neto said.

The Embraer E195-E2 Tech Eagle, an animal-inspired livery. Photo / Embraer

This year it expected to deliver 255 aircraft, including military ones. The company’s commercial aviation backlog is worth just over US$15b ($25.6b) but that’s small fry compared to the trillion-plus Airbus and Boeing combined backlogs. Embraer’s executive jet backlog is about US$7.6b.

Neto told a media tour group that Embraer was confident it was on the right path to sustainable growth.

“We are investing in increasing capacity, investing to make sure the supply chain will follow us in terms of volumes we need.”

The Embraer logo projected onto Cristo Redentor (Christ the Redeemer) before the Iata summit on June 5 in Rio De Janeiro. Photo / Embraer

But he added: “We still have difficulties with our supply chain.”

Neto said the company wanted to reduce the time needed to make new aircraft.

That target was “not easy to execute but easy to understand”, he said.

The tour heard Embraer’s Praetor business jets now took eight-and-a-half months to make, down from 17 months previously.

The Embraer Praetor 500E. Photo / Embraer

“The big challenge we have is to bring more linearity in production and deliveries throughout the year. We still have high concentration in the second half of the year but 2026 is better than 2025,” Neto said as he wrapped up his talk.

“We have engine challenges and now, of course, we have another challenge in the Middle East,” said Arjan Meijer, Embraer Commercial Aviation president and CEO.

He said the E2 programme had 24 customers, with a link to New Zealand’s part of the world through Virgin Australia.

Even before the E2, Virgin Australia operated Embraer aircraft such as this ERJ-190. Photo / Ryan Fletcher

That airline had three 100-seater 190 E2s. Those aircraft have 100 seats, with 68 in economy, 24 in “Economy X” and preferred seating, and eight in business class.

Virgin Australia Regional Airlines last year said the 190-E2 seats were more spacious than the outgoing Fokker 100 jets, and the Embraer was fuel-efficient and had a very low noise profile.

Other Embraer commercial aviation customers are in the US, Latin America and Mongolia.

Meijer echoed Neto’s words about having smoother deliveries year-round rather than a rush in one quarter or half.

The Embraer E-170. Operators include Delta Air Lines, which uses a 69-set configuration. Photo / Ricardo Beccari

He said getting more consistent output would mean more solid cash flow.

The Embraer leaders also spoke about carving out niches, or dominating segments where an airline might find other narrowbodies too big and regional jets too small.

For now, Embraer is a lot smaller than Airbus or Boeing. And it doesn’t have a big presence in New Zealand.

But could that change?

“Our industry is always full of surprises,” Meijer said.

Embraer

Established in the 1960s as Empresa Brasileira de Aeronáutica (Brazilian Aeronautics Company).Privatised in the 1990s, it had initial public offerings in 2000 on the New York and São Paulo stock exchanges.Has Asia-Pacific offices in Melbourne, Singapore and Beijing.Makes aircraft for agricultural aviation, the military, private jets and commercial airlines.Expects revenues in the US$8.2 billion to US$8.5 billion ($14b to $14.5) range this year.Delivered 244 aircraft last year: 78 commercial jets, 155 executive jets, three multi-mission KC-390 Millennium and eight A-29 Super Tucanos in defence and security.

-The Herald travelled to São José dos Campos from Rio de Janeiro courtesy of Embraer.

John Weekes is a business journalist covering aviation. He previously covered consumer affairs, crime, politics and courts.

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