Category Archives: Embraer

Embraer enters the freighter business

Embraer made this announcement:

We’ve just launched a new freighter program that will right-size the cargo industry with E-Jets.

In response to the explosive growth in e-commerce and increased demand for cargo capacity, especially to smaller markets, we’ve developed a program to convert pre-owned E190s and E195s from passenger jets to freighters. First deliveries are planned for 2024.

Rather than simple quick-change procedures in which seats are removed from passenger cabins, our E-Jet freighters have structural modifications. Over head bins are removed, there are new smoke detection and fire suppression systems, the main deck floor is reinforced and has a cargo handling system, and there is a new forward cargo door.

What really makes the E-Jet freighters attractive is their ability to offer optimized loading configurations. Cargo carriers can therefore maximize efficiency by better matching capacity to demand. The E-Jet freighters offer greater frequency and better operating economics in smaller markets than larger aircraft.

How much can our E-Jets freighters carry? Combining under-floor bulk cargo and main deck ULD or pallet capacity, the weights and volumes are impressive:

cargo

The range and payload capacity of the E195F is similar to the B737-300SF (nearly 2,500 nm) yet the E195F burns less fuel, generates fewer emissions, and has lower maintenance and cash operating costs.

Our E-Jet freighter conversion program is another example of an innovative solution to an emerging market opportunity. They are, in fact, bringing the concept of right-sizing to the cargo industry by tapping the gap between turboprop and larger narrow body freighters.

Cargo airlines can now put right-capacity E190F and E195F freighters on the right routes with the right frequency and right economics. Moreover, airlines can now access new smaller markets while deploying their larger aircraft on routes where they are more economical.

Embraer pauses the E175-E2 Jet Development Program

Embraer issued this statement:

Embraer S.A., in compliance with the CVM Resolution 44/2021, informs its shareholders and the market that on February 18 the Board of Directors approved a three-year pause in its E175-E2 jet development program.

As in previous years, the re-programing of activities is associated with the ongoing US mainline scope clause discussions with the pilot unions regarding the maximum take-off weight (MTOW) limitation for aircraft with up to 76 seats, together with current global market conditions for commercial aviation and the continuing interest in the current E175 jet in the US market.

The Company expects to resume the program development activities following the aforementioned period, which will result in a re-programming of the aircraft entry into service between 2027 and 2028.

Embraer claims Boeing “wrongfully terminated the MTA”

Embraer has issued this statement:

Embraer S.A., in compliance with the provisions of the CVM Instruction 358/02 and in connection with the strategic partnership between Embraer and The Boeing Company, informs its shareholders and the market that Embraer received a notice sent by Boeing communicating its decision to terminate the Master Transaction Agreement, based on Boeing’s assertion that supposedly certain closing conditions in the MTA have not been satisfied by Embraer.

Embraer strongly believes that Boeing has wrongfully terminated the MTA, that it has manufactured false claims as a pretext to seek to avoid its commitments to close the transaction and pay Embraer the US$4.2 billion purchase price. Embraer believes Boeing has engaged in a systematic pattern of delay and repeated violations of the MTA, because of its unwillingness to complete the transaction in light of its own financial condition and 737 MAX and other business and reputational problems.

Embraer believes it is in full compliance with its obligations under the MTA and will pursue all remedies against Boeing for the damages incurred by Embraer as a result of Boeing’s wrongful termination and violation of the MTA.

The Transaction involved a long, costly and complex process, which was supported by government authorities and the substantial majority of Embraer’s shareholders, all understanding that the Transaction would be in the best interest of Embraer, its employees, suppliers and customers in commercial aviation.

Embraer remains today a successful, efficient, diversified and vertically integrated company, with a history of serving customers with highly successful products and services built on a strong foundation of engineering and industrial capabilities. Embraer is an exporter and technology developer, with global presence and defense, executive and commercial businesses. Our employees will proudly continue to provide for our clients the high quality products and services they depend on from Embraer every day.

Embraer’s history of over 50 years is lined with many victories but also some difficult moments. All of them were overcome. And that’s exactly what Embraer is going to do again. Embraer shall overcome these challenges with strength and determination.

Embraer will keep its shareholders, the market in general, and all employees, suppliers and clients informed about any relevant updates.

Boeing terminates agreement to establish joint ventures with Embraer

Boeing has made this announcement:

Boeing announced today that it has terminated its Master Transaction Agreement (MTA) with Embraer, under which the two companies sought to establish a new level of strategic partnership. The parties had planned to create a joint venture comprising Embraer’s commercial aviation business and a second joint venture to develop new markets for the C-390 Millennium medium airlift and air mobility aircraft.

Under the MTA, April 24, 2020, was the initial termination date, subject to extension by either party if certain conditions were met. Boeing exercised its rights to terminate after Embraer did not satisfy the necessary conditions.

“Boeing has worked diligently over more than two years to finalize its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions. We all aimed to resolve those by the initial termination date, but it didn’t happen,” said Marc Allen, president of Embraer Partnership & Group Operations. “It is deeply disappointing. But we have reached a point where continued negotiation within the framework of the MTA is not going to resolve the outstanding issues.”

The planned partnership between Boeing and Embraer had received unconditional approval from all necessary regulatory authorities, with the exception of the European Commission.

Boeing and Embraer will maintain their existing Master Teaming Agreement, originally signed in 2012 and expanded in 2016, to jointly market and support the C-390 Millennium military aircraft.

Boeing and Embraer welcome Brazilian approval

Boeing and Embraer welcome the unconditional approval of their strategic partnership by the Administrative Council for Economic Defense (CADE)’s General-Superintendence (SG) in Brazil. The decision will become final within the next 15 days unless a review is requested by CADE Commissioners. The partnership has now received unconditional clearance from every regulatory jurisdiction with the exception of the European Commission, which continues to assess the deal.

“This latest clearance is yet another endorsement of our partnership, which will bring greater competition to the regional jet marketplace, better value for our customers and opportunities for our employees,” said Marc Allen, Boeing’s president of Embraer Partnership & Group Operations.

Brazil’s approval of the deal is a clear demonstration of the pro-competitive nature of our partnership,” said Francisco Gomes Neto, president and CEO of Embraer. “It will not only benefit our customers, but also allow the growth of Embraer and the Brazilian aeronautical industry as a whole.”

Unconditional clearance has now been granted in Brazil, United States, China, Japan, South Africa, Montenegro, Colombia, and Kenya.

Boeing and Embraer have been in discussion with the European Commission since late 2018, and continue to engage with the Commission as it proceeds through its assessment of the transaction.

“We have been productively engaged with the Commission to demonstrate the pro-competitive nature of our planned partnership, and we look forward to a positive outcome,” Boeing’s Allen said. “Given the positive endorsement we’ve seen from customers across Europe and the unconditional clearance we’ve received from every other regulator who has considered the transaction, we look forward to securing final approval for the transaction as soon as possible.”

The planned strategic partnership between Embraer and Boeing comprises two joint ventures: one joint venture made up of the commercial aircraft and services operations of Embraer (Boeing Brasil – Commercial) in which Boeing will own 80 percent and Embraer will hold 20 percent; and another joint venture to promote and develop markets for the multi-mission medium airlift C-390 Millennium (Boeing Embraer – Defense) in which Embraer will own a 51 percent stake and Boeing will own the remaining 49 percent.

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.

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.