ALTA: Embraer to take on CSeries with re-engined E-Jet

Rio de Janeiro
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ALTA arrived on Embraer's home ground as news broke that the Brazilian airframer has decided not to follow its rival Bombardier into a head-to-head fight with mainline airliner manufacturers and launch an all-new narrowbody.

It will instead develop a major upgrade for its E-Jet family, a move that has been well received by analysts - and Bombardier. The announcement followed a lengthy evaluation of a potential new five-abreast design to compete in the 130-160-seat segment.

"After examining our client and competitor scenarios, we had two options: one was to build a completely new airplane the other was to re-engine the E-Jet," said Embraer's Eduardo Munhos de Campos, who is vice president airline marketing in Latin America and the Caribbean.

"The business case that is more sound with better returns is re-engining," he told Airline Business Daily. "And we have seen that with what Airbus and Boeing are doing what the A320neo and 737 Max, the market has accepted re-engining."

Bombardier sees the Embraer decision as good for the Canadian manufacturer, as it means it will not face an all-new rival to the CSeries 110-145 seater. "We're very pleased. It confirms yet again that we will be the only one who takes the bold step of creating a 100% new airplane in this market segment that needs a new generation airplane to replace some of the older aircraft," said Philippe Poutissou, who is vice president marketing at Bombardier Commercial Aircraft.

"Secondly it points to their recognition that if they're want to be competitive in the future they need to do something [with the E-Jet]," he added.

Aviation analyst Les Weal, who is director of valuations and appraisals at Flightglobal's data and consultancy arm Ascend, thinks that Embraer's decision is the right one. "Taking on Airbus and Boeing is for the brave or those with very deep pockets," he said. "Life has just got tougher for the competition such as the Mitsubishi MRJ and CSeries CS100," he added.

"Rather than have every aircraft manufacturer converge on a narrow seating band, in fact there is now sufficient overlap in the range of seating on offer from all the new build and re-engined products, to enable them to capture customers at the core of their own market segments," said Ascend's Global Head of Consultancy Eddy Pieniazek.

With Embraer targeting a service-entry for the proposed re-engined E-Jet in late 2017 or early 2018, it aims to finalise its strategic direction by early next year, said Munhos de Campos. It will then begin defining the upgrades that it will incorporate in the re-engined family and central to this will be to select an engine to replace the E-Jet's existing General Electric CF34: "The engines that the manufacturers have available are all offering around 15% lower fuel burn," he said.

Other enhancements under evaluation include a composite fuselage and a possible stretch of beyond the existing 110-120-seat E-195 variant.

The current family, which straddle the 70-120 seat sector, have a four-abreast cabin. Embraer had been considering a large fuselage cross-section for the all-new aircraft to enable a five-abreast configuration like the Bombardier CSeries, which is more suitable for a family in the 130-160 seat sector.

"It remains to be seen if there is indeed a stretch to the E-Jet airframe, and which engine(s) is chosen," said Pieniazek. "After that, the coming decade will have been pretty much defined in terms of what models will be available, and when, in the narrowbody market."

Incumbent E-Jet supplier GE is currently developing an advanced turbofan in the same power class as the CF34-10, called the "Passport".

Ascend senior analyst George Dimitroff sees Pratt & Whitney's PW1000G geared turbofan as another potential candidate with the smallest variant of the engine that powers the MRJ family. "The CF34-10E is 57in [145cm] in diameter, the PW1215/1217G is actually 1in smaller at 56in," he said. "With some space to spare under the wing the engine could even grow a little which might improve the efficiency over the MRJ."

To date, Embraer has sold 1,100 E-Jets and delivered around 800 aircraft. The backlog represents around three years of production at current output rates. "The market has embraced E-Jets and it appears that airlines are content with re engined products," said Weal.