Category Archives: Embraer

Boeing-Embraer strategic partnership is taking shape

Boeing and Embraer continue to work closely together to establish their strategic partnership, positioning both companies to deliver greater value to airline customers and the flying public, and to accelerate growth in global aerospace markets.

Since receiving approval for the partnership from Embraer shareholders in February this year, the companies have undertaken diligent planning for the creation of a joint venture made up of the commercial aircraft and services operations of Embraer. Boeing will own 80 percent of the new company, to be named Boeing Brasil – Commercial. Embraer will hold the remaining 20 percent.

The transaction remains subject to regulatory approval; the two companies are actively engaged with authorities in relevant jurisdictions and have obtained a number of regulatory approvals. Following a detailed assessment by the U.S. Federal Trade Commission, the parties’ strategic partnership has received clearance to close in the United States. The European Commission recently indicated it will open a Phase II assessment in its review of the transaction, and Boeing and Embraer look forward to assisting with that review. Based on this development, however, the companies now expect the transaction to close in early 2020.

Boeing and Embraer are also preparing to launch a joint venture to promote and develop markets for the multi-mission medium airlift KC-390. Under the terms of the proposed partnership, Embraer will own a 51 percent stake in the joint venture and Boeing will own the remaining 49 percent. Two KC-390 milestones were recently achieved by Embraer: the first KC-390 was delivered to the Brazilian Air Force, and the first international purchase was announced by Portugal.

The comprehensive Boeing-Embraer strategic partnership, embodied through these two joint ventures, will position the companies to compete in the global marketplace, to deliver greater value to customers, and to boost the Brazilian aerospace industry as a whole.

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Embraer E195-E2 granted certification by ANAC, FAA and EASA

Embraer has issued this statement:

At a ceremony held today at the Company’s facilities in São José dos Campos, Embraer received the Type Certificate for the E195-E2 from three regulatory authorities: ANAC, the Brazilian Civil Aviation Agency (Agência Nacional de Aviação Civil); the FAA (U.S. Federal Aviation Administration) and EASA (European Aviation Safety Agency).

The E195-E2 is the biggest of the three members of the E-Jets E2 family of commercial airplanes and the largest commercial aircraft Embraer has ever made.

“Just like the E190-E2, we once again obtained type certification simultaneously from three major world regulatory authorities,” said Paulo Cesar de Souza e Silva, Embraer President & CEO. “This is another great achievement from our engineering and program teams. They’ve built, and now have certification for, the most efficient single-aisle jet on the market. And they’ve done it again right on schedule and exceeding specification.” “Our flight tests confirmed that the aircraft is better than its original specification. Fuel consumption is 1.4% lower than expected – that’s 25.4% less fuel per seat compared to the current-generation E195.

Maintenance costs are 20% lower,” said John Slattery, President & CEO, Embraer Commercial Aviation. “There’s no question that airlines are going to love this airplane’s economics. The E195-E2 is the ideal aircraft for growing regional business and complementing existing low-cost and mainline fleets.”

Embraer ERJ 190-400STD (E195-E2) PR-ZIQ (msn 19020041) FLL (Bruce Drum). Image: 104598.

Above Copyright Photo: Embraer ERJ 190-400STD (E195-E2) PR-ZIQ (msn 19020041) FLL (Bruce Drum). Image: 104598.

The E195-E2 will enter service in the second half of 2019 with Azul Linhas Aéreas Brasileiras S.A. Binter Canarias, of Spain, will also receive its first E195-E2 in 2019.

Embraer used two prototype aircraft in the E195-E2 certification campaign, one for aerodynamic and performance tests, the other for the interior and validation of maintenance tasks.

The E195-E2 is the most environmentally friendly aircraft in its class. It has the lowest levels of external noise and emissions. The cumulative margin to ICAO Stage IV noise limit ranges from 19 to 20 EPNdB, 4.0 EPNdB better than its direct competitor.

Like the E190-E2, the E195-E2 has the longest maintenance intervals in the single-aisle jet category with 10,000 flight hours for basic checks and no calendar limit for typical E-Jet operations. This means an additional 15 days of aircraft utilization over a period of ten years compared to current generation E-Jets.

The E195-E2 features new ultra-high bypass ratio engines, a completely new wing, full fly-by-wire and new landing gear. Compared to the first-generation E195, 75% of aircraft systems are new. The E195-E2 has 3 additional seat rows. The cabin can be configured with 120 seats in two classes, or up to 146 in single class.

Embraer is the world’s leading manufacturer of commercial aircraft up to 150 seats with more than 100 customers from all over the world. For the E-Jets program alone, Embraer has logged more than 1,800 orders and 1,500 deliveries, redefining the traditional concept of regional aircraft by operating across a range of business applications.

E195-E2 Performance Improvements E195-E2 performance targets were to be similar to the E195 but with more payload (12 more passengers). The final results, however, show significant improvements in many areas. Range – Maximum range is 2,600 nautical miles with a full passenger load, 600 nm more than the E195. Restricted Airports – The E195-E2 can serve more markets from limited airfields.

From Denver, the aircraft’s range is more than 900 nm longer than the E195. From Santos Dumont, the gain is more than 500 nm. Take Off Field Length – At MTOW, the E195-E2 requires only 1,800 m (2,180 m for the E195.)

Boeing-Embraer partnership receives shareholder approval

Boeing has made this announcement:

The proposed strategic partnership between Boeing and Embraer was approved today by Embraer’s shareholders during an Extraordinary General Shareholders’ Meeting held at the company’s headquarters in Brazil.

At the special meeting, 96.8 percent of all valid votes cast were in favor of the transaction, with participation of approximately 67 percent of all outstanding shares. Shareholders approved the proposal that will establish a joint venture made up of the commercial aircraft and services operations of Embraer. Boeing will hold an 80 percent ownership stake in the new company, and Embraer will hold the remaining 20 percent.

The transaction values 100 percent of Embraer’s commercial aircraft operations at $5.26 billion, and contemplates a value of $4.2 billion for Boeing’s 80 percent ownership stake in the joint venture.

Embraer shareholders also agreed to a joint venture to promote and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51 percent stake in the joint venture, with Boeing owning the remaining 49 percent.

“This groundbreaking partnership will position both companies to deliver a stronger value proposition for our customers and other stakeholders and create more opportunities for our employees,” said Paulo Cesar de Souza e Silva, President and CEO of Embraer. “Our agreement will create mutual benefits and boost the competitiveness of both Embraer and Boeing.”

“Approval by Embraer’s shareholders is an important step forward as we make progress on bringing together our two great aerospace companies. This strategic global partnership will build on Boeing’s and Embraer’s long history of collaboration, benefit our customers and accelerate our future growth,” said Dennis Muilenburg, Boeing chairman, president and chief executive officer.

Embraer’s defense and executive jet business and services operations associated with those products would remain as a standalone publically-traded company. A series of support agreements focused on supply chain, engineering and facilities would ensure mutual benefits and enhanced competitiveness between Boeing, the joint venture and Embraer.

“Our shareholders have recognized the benefits of partnering with Boeing in commercial aviation and the promotion of the multi-mission airlift KC-390, as well as understanding the opportunities that exist in the executive aviation and defense business,” said Nelson Salgado, Embraer Executive Vice President of Finance and Investor Relations.

“People across Boeing and Embraer share a passion for innovation, a commitment to excellence, and a deep sense of pride in their products and their teams – these joint ventures will strengthen those attributes as we build an exciting future together,” said Greg Smith, Boeing Chief Financial Officer and Executive Vice President of Enterprise Performance & Strategy.

Boeing and Embraer announced in December 2018 that they had approved the terms for the joint ventures and the Brazilian government gave its approval in January 2019. Shortly thereafter, Embraer’s board of directors ratified its support for the deal and definitive transaction documents were signed. The closing of the transaction is now subject to obtaining regulatory approvals and the satisfaction of other customary closing conditions, which Boeing and Embraer hope to achieve by the end of 2019.

Embraer will continue to operate the commercial aviation business and the KC-390 program independently until the closing of the transaction.

Embraer and Boeing welcome Brazilian Government approval of strategic partnership

Embraer and Boeing have welcomed approval by the Government of Brazil of the strategic partnership that will position both companies to accelerate growth in global aerospace markets.

The government’s approval comes after the two companies last month approved terms for the joint venture that will be made up of the commercial aircraft and services operations of Embraer. Boeing will hold an 80 percent ownership stake in the new company and Embraer will hold the remaining 20 percent.

The companies have also agreed to the terms of another joint venture to promote and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51 percent stake in the joint venture, with Boeing owning the remaining 49 percent.

Once Embraer’s Board of Directors ratifies its prior approval, the two companies will then execute definitive transaction documents. The closing of the transaction will be subject to shareholder and regulatory approvals and customary closing conditions. Assuming the approvals are received in a timely manner, the transaction is intended to close by the end of 2019.

Photo: Embraer.

Embraer and Boeing approved the terms of strategic aerospace partnership, seek Brazilian Government approval

Embraer and Boeing have approved to the terms of a strategic partnership that would position both companies to accelerate growth in global aerospace markets.

The approved terms define the joint venture comprising the commercial aircraft and services operations of Embraer, in which Boeing will hold an 80 percent ownership stake and Embraer will hold the remaining 20 percent. The transaction remains subject to approval by the Government of Brazil, after which Embraer and Boeing intend to execute definitive transaction documents. The closing of the transaction will then be subject to shareholder and regulatory approvals and customary closing conditions.

Under the terms of the proposed partnership, Boeing will acquire an 80 percent ownership stake in the joint venture for $4.2 billion. The partnership is expected to be neutral to Boeing’s earnings per share in 2020 and accretive thereafter. Estimated annual pre-tax cost synergies of approximately $150 million are anticipated by the third year of operations.

Once the transaction has closed, the commercial aviation joint venture will be led by Brazil-based management, including a president and chief executive officer. Boeing will have operational and management control of the new company, which will report directly to Dennis Muilenburg, Boeing chairman, president and chief executive officer. Embraer will retain consent rights for certain strategic decisions, such as transfer of operations from Brazil.

“Boeing and Embraer know each other well through more than two decades of collaboration, and the respect we have for each other and the value we see in this partnership has only increased since we announced our joint efforts earlier this year,” said Dennis Muilenburg, Boeing chairman, president and chief executive officer.

“We are confident that this partnership will deliver great value to Brazil and the Brazilian aerospace industry as a whole. This alliance will strengthen both companies in the global market and is aligned with our long-term sustainable growth strategy,” said Paulo Cesar de Souza e Silva, Embraer president and chief executive officer.

The companies have also agreed to the terms of another joint venture to promote and develop new markets for the multi-mission medium airlift KC-390. Under the terms of this proposed partnership, Embraer will own a 51 percent stake in the joint venture, with Boeing owning the remaining 49 percent.

The transaction is subject to approval by the Government of Brazil, ratification by the Embraer Board of Directors and its further authorization to execute the definitive transaction documents. Once the parties have executed the definitive transaction agreements, the strategic partnership will then be subject to shareholder and regulatory approvals, as well as other customary closing conditions. Assuming the approvals are received in a timely manner, the transaction is intended to close by the end of 2019.

Embraer E190-E2 lands at London City Airport

On July 13, 2018 an Embraer E190-E2 aircraft landed for the first time at London City Airport (LCY). The newest aircraft from Embraer, the world’s quietest and most efficient in its class, entered into service in April this year. An aircraft from Embraer’s test fleet stopped off at LCY on its way to appear at next week’s Farnborough Air Show. The visit demonstrates the importance Embraer places on being able to offer LCY capability to airlines and its intention to work with London City Airport to certify the E2 to meet customer demand, which is likely to rise as LCY increases connectivity.

 

Arjan Meijer, Chief Commercial Officer, Embraer Commercial Aviation, said, “For Embraer, London City feels like home, wherever you look, our aircraft are there. So it’s a big moment for us to bring the newest generation Embraer jet to this important European hub. We know that passengers will love the new aircraft, still with no middle seats and featuring larger overhead bins, and Londoners will also appreciate the quietness of the aircraft and its low emissions.”

London City Airport is London’s most central airport, known for its convenience and speedy passenger experience. Its location means operating aircraft have to be compatible with the airport’s steep approach and short runway. Embraer aircraft are well suited to this and have operated from LCY since 2009, when BA Cityflyer started operations with the E170. Embraer aircraft accounted for nearly 60% of departures from LCY in 2017.

 

Richard Hill, Chief Commercial Officer at London City Airport, said: “to welcome the Embraer E2 to London City Airport for the first time is a crucial milestone towards certification and subsequent commercial operation at London’s most central airport. The first generation of E-Jets have been intrinsic to London City’s growth, so much so that up to three quarters of all passengers now land or depart on the aircraft. As we continue a £480m transformation, due for completion in 2022, the E2 has enormous potential for London City, with proven ability to operate with less noise, fewer emissions, and better fuel efficiency to open up new destinations, delivering significant benefits for our airline customers, passengers and local neighbors.”

 

In certification testing EASA figures confirmed the E190-E2 has the lowest noise levels among all new generation single aisle aircraft. If this performance can be replicated in the operational environment of London City Airport, the E190-E2 would meet the minimum noise restrictions of the airport’s new Aircraft Noise Categorisation Scheme (ANCS), which will be fully introduced next year. The E190-E2 is the first of a new generation of crossover narrowbody jets from Embraer. The aircraft entered into service with Norwegian carrier Widerøe in April.

 

The E195-E2 goes into service next year with Azul in Brazil. The E190-E2 cuts fuel burn by more than 17%, and is the quietest passenger jet in the world today both in the cabin and outside.

 

Since entering revenue service, the E-Jets family has received more than 1,800 orders and over 1,400 aircraft have been delivered. Today, E-Jets are flying in the fleet of 70 customers in 50 countries. The versatile 70 to 150-seat family is flying with low-cost airlines as well as with regional and mainline carriers.

Photo: Embraer.

Boeing and Embraer together: Strategic partnership MOU signed

Boeing and Embraer announced they have signed a Memorandum of Understanding (MOU) to establish a strategic partnership that positions both companies to accelerate growth in global aerospace markets.

The non-binding agreement proposes the formation of a joint venture comprising the commercial aircraft and services business of Embraer that would strategically align with Boeing’s commercial development, production, marketing and lifecycle services operations. Under the terms of the agreement, Boeing will hold an 80 percent ownership stake in the joint venture and Embraer will own the remaining 20 percent stake.

“By forging this strategic partnership, we will be ideally positioned to generate significant value for both companies’ customers, employees and shareholders – and for Brazil and the United States,” said Dennis Muilenburg, Boeing’s Chairman, President and Chief Executive Officer. “This important partnership clearly aligns with Boeing’s long-term strategy of investing in organic growth and returning value to shareholders, complemented by strategic arrangements that enhance and accelerate our growth plans,” Muilenburg said.

“The agreement with Boeing will create the most important strategic partnership in the aerospace industry, strengthening both companies’ leadership in the global market,” said Paulo Cesar de Souza e Silva, Embraer Chief Executive Officer and President. “The business combination with Boeing is expected to create a virtuous cycle for the Brazilian aerospace industry, increasing its sales potential, production, creating jobs and income, investments and exports, and in doing so, adding more value to customers, shareholders and employees.”

The transaction values 100 percent of Embraer’s commercial aircraft operations at $4.75 billion, and contemplates a value of $3.8 billion for Boeing’s 80 percent ownership stake in the joint venture. The proposed partnership is expected to be accretive to Boeing’s earnings per share beginning in 2020 and to generate estimated annual pre-tax cost synergies of approximately $150 million by year three.

The strategic partnership will bring together more than 150 years of combined leadership in aerospace and leverage the two companies’ highly complementary commercial product lines. The partnership is a natural evolution of a long-standing history of collaboration between Boeing and Embraer over more than 20 years.

On finalization, the commercial aviation joint venture will be led by Brazil-based management, including a President and Chief Executive Officer. Boeing will have operational and management control of the new company, which will report directly to Muilenburg.

The joint venture will become one of Boeing’s centers of excellence for end-to-end design, manufacturing, and support of commercial passenger aircraft, and will be fully integrated into Boeing’s broader production and supply chain.

Boeing and the joint venture would be positioned to offer a comprehensive, highly complementary commercial airplane portfolio that ranges from 70 seats to more than 450 seats and freighters, offering best-in-class products and services to better serve the global customer base.

In addition, both companies will create another joint venture to promote and develop new markets and applications for defense products and services, especially the KC-390 multi-mission aircraft, based on jointly-identified opportunities.

“Joint investments in the global marketing of the KC-390, as well as a series of specific agreements in the fields of engineering, research and development and the supply chain, will enhance mutual benefits and further enhance the competitiveness of Boeing and Embraer,” said Nelson Salgado, Embraer’s Executive Vice President, Financial and Investor Relations.

Finalization of the financial and operational details of the strategic partnership and negotiation of definitive transaction agreements are expected to continue in the coming months. Upon execution of these agreements, the transaction would then be subject to shareholder and regulatory approvals, including approval from the Government of Brazil, as well as other customary closing conditions. Assuming the approvals are received in a timely manner, the transaction is expected to close by the end of 2019, 12-18 months after execution of the definitive agreements.

“This strategic partnership is a natural evolution of the long-standing history of collaboration between Boeing and Embraer on a range of aerospace initiatives over almost three decades,” said Greg Smith, Boeing Chief Financial Officer and Executive Vice President of Enterprise Strategy & Performance. “It is aligned with Boeing’s enterprise strategy of pursuing strategic investment opportunities where they demonstrate real value and accelerate our organic growth plans. This partnership will strengthen the vertical capabilities of Boeing and enhance value for our customers through the full lifecycle of industry-leading products and services.”

Boeing and Embraer will benefit from a broader scale, resources and footprint, including global supply chain, sales and marketing, and services network, which will enable them to capture benefits from best-in-class efficiencies across the organizations. Additionally, the strategic partnership will provide opportunities to share best practices in manufacturing and across development programs.

The transaction will have no impact on Boeing and Embraer financial guidance for 2018 or Boeing’s cash deployment strategy and commitment to returning approximately 100 percent of free cash flow to shareholders.