Embraer leans towards E-Jets re-engining in about five years

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Embraer is leaning towards re-engining its E-Jets family in about five years, saying it does not see a "window of opportunity" for launching a larger-capacity clean sheet aircraft right now.

Over the next few months the Brazilian airframer will enter discussions with airline customers about how its E-Jets family should evolve, including potentially re-engining, which it sees happening "more towards the end of the decade", company CEO Frederico Curado said today during a third-quarter earnings conference call.

Pressed for a more specific timeframe for re-engining, Curado noted that with Airbus offering the re-engined A320neo around the end of 2015/early 2016, and Boeing offering the re-engined 737 Max in 2017, "probably not much longer after that is probably when we would be coming to the marketplace".

While not abandoning the possibility of ultimately offering a larger-capacity type, Embraer is having difficulty seeing "a return on capital" if it were to invest billions of dollars in a new programme at this time, said Curado.

Embraer's concerns are quite specifically related to return on investment and ensuring it creates shareholder value if it were to invest in a clean-sheet design. The challenge "is not technical we think", said Curado, noting that Embraer has learned a great deal with its highly digital E-Jets.

He noted that the market "is clearly endorsing the continuation" of the 737 and A320 narrowbody families "and obviously those have a significantly bigger size than ourselves and others so that's where the high risk is", added Curado.