EBACE: Embraer - deliveries to recover in 2012

Washington DC
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Embraer is predicting that business aircraft deliveries will take three years to recover to 2008's rates, assuming the economy bounces back next year and sales recover in 2012.

Once the delivery rebound happens,Luis Carlos Affonso, Embraer executive vice-president for executive aviation, says the increase in output everyyear will climb more slowly for 10 years compared withits mercurial year-over-year rise from 2005to 2008.

Affonso admits to wearing rose-coloured glasses when looking forward at the NBAA show in October. "We thought backlogs would sustain deliveries," he says. "This was proven wrong." Instead, owners cancelled or delayed their orders as the economy and flight hours plunged. Affonso says European business jet traffic has dropped by 23%, the USA by 30% and fractional owners are seeing a liquid reduction in shares (more returned than sold).

The company's revised forecast now calls for 11,000 business jets to be delivered over the next 10 years, compared withthe 13,000 it had predicted at the NBAA. Growth will be focused on emerging markets in Asia and elsewhere, with the US and Europe growth rates contracting slightly year over year.

Embraer's mantra from 2005 -to be a major player in the business aviation market by 2015 -continues to steer the airframer's course, however. Although much has changed since NBAA, Affonso says Embraeris continuing its new aircraft development as before, keeping entry into service dates for the Phenom 300 (this year), the Legacy 500 (2012) and Legacy 450 (2013) in place.