We received the tip at noon: Boeing Commercial Airplanes and Embraer were going to make an "important announcement" downtown at the US Chamber of Commerce at 15:30. Jim Albaugh and Frederico Curado, CEOs of both companies, would be there. That's all we needed. We dropped our afternoon plans, jumped in a taxi and headed for Lafayette Square, the chamber's strategic location caddy-corner to the White House.
The dream headline was our goal. Something like, "Boeing, Embraer partner to develop next-generation single-aisle", had a nice ring to it. Alas, it was just a dream.
As more journalists arrived, the press aides of both companies attempted to lower our expectations. No specific projects would be announced, they said. Then, the aides uttered those awful three words, the term that kills all headlines: memorandum of understanding, or MoU.
We're not saying all MoUs are uninteresting to journalists, but there's a reason why Googling the terms "mou" and "few details" brings up 91,500 results.
In truth, we probably should have known better. Boeing is the aerospace industry king of the MoU -- and we don't mean just the kind that lead to aircraft orders. Boeing has been signing MoUs all over the world. It is already bound to "develop materials and systems" for South Korea, to share "key business and manufacturing tools" with India, and to provide an Israeli-Brazilian firm "opportunities" to work on the Super Hornet fighter.
Boeing even signed an MoU with Embraer -- and, in fact, Airbus -- last year to work jointly on bio-fuels. When it comes to MoUs, Boeing never leaves an "IOU".
It's possible, of course, this MoU will be different. It was signed as part of a far larger event that brought Brazil's President Dilma Rousseff to the White House today. Indeed, the aviation agreement was only a footnote in a broader diplomatic discussion between the two countries over new collaboration on energy, defence and scientific research. It just so happens that it comes at a particularly sensitive moment for the top commercial aviation manufacturers of both countries.
Boeing right now really wants to sell Super Hornets to Brazilian air force and navy. Embraer wants probably even more to sell Super Tucanos to the US Air Force.
Each is the largest commercial aircraft manufacturer in the two most populous countries in the Americas, yet they have no real track record of collaboration on anything despite almost no overlapping market segments. Embraer, meanwhile, is searching for new ways to expand its phenomenal growth spurt over the last two decades, but has already conceded the over-130-seat market to Airbus and Boeing. At some point, Embraer may decide it needs to partner with Boeing or Airbus to continue its growth, or it can try to keep expanding within its already defined pocket of commercial and military aircraft. For Embraer, perhaps an MoU signed in the shadow of the White House may tip the scales of history slightly towards Boeing.
Of course, it's hard to fit all of that in a headline.