PARIS: Stage set for new E-Jet launch and orders

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Embraer still has several key decisions pending that could define and perhaps build order momentum for what it still unofficially calls the second generation (G2) E-Jet family.

As of early May, Embraer was on track to formally launch the programme by "mid-year", a schedule reference that is compatible with the timing of the Paris air show. It is certainly a familiar event for the E-Jet programme. The 1999 event saw Crossair (now Swissair) place an order for 30 Embraer 170s and 30 Embraer 190s with a combined list value of $4.2 billion. At the time, the deal helped legitimise Embraer's large regional jet family in the face of stiff and ultimately futile competition from the Dornier 728Jet.

Whether Embraer picks up a similar boost at this year's edition of the Paris event for the original E-Jet's successor remains to be seen, but it is clear the Brazilian aircraft maker intends to formally launch its new product with a backlog that includes multiple orders.

Embraer chief executive Frederico Curado made that intention clear enough in a teleconference with analysts discussing first quarter earnings on 13 March. "Ideally, I would like to launch this new vision of the aircraft with some launch customers," Curado said.

Some prominent customers have not hesitated to signal their interest in Embraer's latest aircraft. Air Lease Corp (ALC) founder and chief executive Steven Udvar-Hazy already owns an order for 30 of the original E-Jets, and has not been shy with praise for the next generation aircraft.

Speaking to analysts in a 10 May quarterly earnings teleconference, Udvar-Hazy included the G2 E-Jet as one of the three aircraft - including the Boeing 787-10X and 777-9X - that are under evaluation by ALC. He described the evaluation as a follow-on to the lessor's order in February for 25 Airbus A350s.

Patience will have to be a characteristic of the G2 E-Jet's launch customers. To the consternation of some analysts, including Teal Group aerospace consultant Richard Aboulafia, Embraer plans to introduce the aircraft into service in 2018, or two years after the scheduled arrival of the Mitsubishi MRJ regional jet and four years after the planned operational debut of the CS100 variant of the Bombardier CSeries.

The MRJ90, which competes in the same class as the 78-seat E-175, has already exploited its two-year advantage, signing a landmark deal with SkyWest Airlines, the largest of the US regional carriers.

But Embraer appears to have little flexibility to accelerate the schedule. The Brazilian company has tended to focus engineering resources on one programme at a time. For example, the ERJ series was followed immediately by the larger E-Jet family. The E-Jet, in turn, was followed by the Phenom series, which marked Embraer's entrance into the business jet market with a purpose-built jet.

The company's engineering resources have been focused on ushering in the fly-by-wire Legacy 500 business jet into service for the past two years. That programme has now fallen as much as two years behind schedule, with a planned entry into service now during the second half of 2014. Embraer then must test and deliver the KC-390 tanker transport to the Brazilian air force in 2016. That means to accelerate the G2 E-Jet family by more than several months would require the airframer's internal resources to perform an overlapping certification programme with the new airliner and the KC-390. Curado addressed the dilemma succinctly in the March call with analysts: "At this stage I would not count on anything earlier than 2018," he said. "It's not a re-engining. It's a major revamp of the airplane."

Embraer also has to allow sufficient time to address the technical challenges of delivering the G2 E-Jet within roughly five years.

As a derivative of the current E-Jet, the second generation can at least borrow the fuselage and cross-section of its predecessor. The wings on each of the smaller E-170/175 and larger E-190/195 variants will be replaced and enlarged to improve aerodynamic performance. Embraer has decided to use aluminium to fashion the G2 E-Jet's new wings, rather than switch to a lighter - but more costly - carbon-fibre composite material. The latter is deemed of less value to generate fuel savings on the 400-600nm (741-1,110km) stages routinely flown by E-Jet family customers.

That follows a consistent strategy for the G2 E-Jet family and its cautious embrace of new technology, with Embraer especially focusing on the price sensitivity of regional airlines and lessors.

Embraer only committed to the re-engining programme in November 2011 after spending several years evaluating a cleansheet design for an aircraft that would compete in the 130-160 seat market with the CSeries. Boeing's decision to re-engine the 737 Max in August 2011 persuaded Embraer that there was no room left in the market for an aircraft larger than 130 seats. The company continues to evaluate such an aircraft, and last August, it displayed - at a trade show in Brazil - multiple concepts of a new narrowbody that could enter service after 2025.

For the near term, however, the focus is on delivering a re-engined and rewinged jet that can deliver "double-digit" reductions in fuel burn, emissions and maintenance costs, but at a price that the market is willing to pay. Embraer launched the E-190/195 series projecting a market for 250 orders and as of 31 March, it had already delivered 459 with 97 more on backorder. One of the keys to having a similar success with the G2 E-Jet family is to again find the right balance between performance and development cost.

Embraer is upgrading the G2 E-Jet's flightdeck with larger displays, but keeping Honeywell as the supplier for the underlying Primus Epic II avionics suite. It has not yet selected a supplier for the aircraft family's fly-by-wire flight control system.

But the most important driver of the double-digit improvements that Embraer is projecting for the new version of the E-Jets is the engines. The selection of the Pratt & Whitney PurePower PW1700G and PW1900G geared turbofans marked a turning point for the E-Jet family. General Electric not only supplies the CF34 turbofan on the current E-Jet, it has also ordered 55 current E-Jets from its leasing arm. GE's bid, based on the NG34 engine, was rejected in favour of P&W's offer with two separate engines.

Embraer is clearly pleased with the switch to the P&W powerplants, which Curado has colourfully described as "kick-ass" engines. Fortunately, Embraer appears to be in no particular rush to receive them. P&W already has four more versions of the same PurePower series in development, ahead of the PW1700G and PW1900G, for the G2 E-Jets. Only one of them - the PW1500G for the CSeries - has completed engine certification. Three more are scheduled to be certificated by 2015, and they will be followed by the two for Embraer in 2016.

The PurePower series' diversity offered another strategic advantage for Embraer. The current family of E-Jets uses two variants of the CF34 with a thrust range between 14,000lb-thrust (62.3kN) and 20,000lb-thrust. The range for the P&W-powered E-Jets falls between 15,000lb-thrust and 22,000lb-thrust.

The extra margin of the latter allows Embraer to have the flexibility to expand the size of the G2 E-Jet fleet. More than a year ago, Udvar-Hazy advised Embraer to further stretch the two largest E-Jets, increasing the single-class seat counts from 114 to 118 for the E-190 and from 122 to as many as 134 for the E-195.

The larger seat counts allow Embraer to directly the challenge the CS100, but with a four-abreast seat layout and nearly the same engine.