Embraer will not be pressured into next-gen narrowbody development

Embraer is cooking with gas, as they say. The company today reported a 61% increase in fourth quarter net profit on a 77% rise in revenue. A number of factors contributed to these gains. Discussing its results in a conference call this morning, Embraer president and CEO Frederico Fleury Curado said dedicated efforts to address the E-Jet family’s growing pains over the last 18 months have proven effective.

Now enjoying the product of its labor – with the E-Jets maturing and customers vocalizing their satisfaction – it’s no wonder that Embraer does not see an immediate need to counter the proposed 110/130-seat CSeries (now on sale) or an Airbus/Boeing narrowbody replacement (which isn’t supposed to come down the pike until the latter part of the next decade anyway).

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“We still do not have a clear vision about what is the optimum configuration of the next narrowbody aircraft, anything from 80- to 180-seats,” he says, noting that it is his understanding that neither Boeing nor Airbus has decided on “anything with that respect either”.

As a leading force in the 70- to 120-seat market, he says, Embraer has to be “very sober about making the right move at the right time”.

“We will not put ourselves in a pressure until we are convinced exactly which way to go.”

Certainly, if the CSeries is launched, and the Mitsubishi MRJ is confirmed, it is “rational” to imagine that Embraer may have “some market share lost with those new airplanes”, says Curado.

But he notes that “the level of activity that we have been seeing since last year has not decreased” and, in fact, it is “very intense activity”.

Embraer is not idle in terms of development; it continues to develop the E-Jet family, focusing on ETOPS and other initiatives.

Stay tuned…

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One Response to Embraer will not be pressured into next-gen narrowbody development

  1. jon Dudeck March 14, 2008 at 6:26 pm #

    Considering that Bombardier has been contributing only 1% to 2% of revenues to R&D and that everybody else has been at about 5% I don’t think I would be too concerned about the C series either.

    Unless the C series is incorporating 787 type technologies (bleedless engines, composite airframe etc.) most of the new efficiencies will have to be gained from the GTF. If that is the only difference I am sure Embrear, and everyone else, can engineer a new engine pylon.