Brazilian manufacturer sees North Americanmarket opening up rapidly after pilots agree to relax scope clauses

Embraer is in negotiations with US Airways to sell it more than 100 78-seat Embraer 175 aircraft, as part of the airline's programme of recovery from bankruptcy protection. The Brazilian manufacturer believes the US market will open quickly as other airlines follow US Airways in securing revisions to scope clauses limiting 70-seat-class jet operations.

Orlando José Ferreira Neto, Embraer's director of market intelligence, says US Airways is talking about its urgent need to restructure its fleet with smaller aircraft as part of its recovery plan. Its new scope clause permits pilots to fly aircraft up to 78 seats, and the airline is close to defining its exact requirements for "over 100 aircraft", says Ferreira. "They will have to move fast, after moving out of Chapter 11, to get delivery positions in place," he adds. Embraer expects to receive an order within one month of US Airways' emergence from bankruptcy protection.

After bankruptcy, US Airways intends to acquire up to 200 regional jets. Hinting at a leaning toward the Embraer 170 family, chief executive David Siegel recently told a Washington DC audience that he would be "very excited" for US Airways to be the US airline launch customer for the aircraft. Any deal, however, could be held up by financing - increasingly difficult to arrange in the current industry turmoil.

Luiz Hamilton Lima, programme manager for the 170/190, says that the São José dos Campos-based manufacturer has scrapped development of a 69-seat variant, the 170SL, which was set to be certificated after the 170LR version.

Embraer initially forecast scope clauses would not be relaxed until the 2006-7 round of labour negotiations, but now believes that as airlines fight for survival, pilots will accept smaller aircraft in mainline fleets this year.

Adds Lima: "We have received clear indications that scope clauses will not be a factor in the USA in the medium term." Ferreira estimates there will be demand for around 600 70-seat aircraft in the USA in the next five years, to be shared largely between Embraer and its Canadian rival Bombardier. Low-cost carrier JetBlue has been investigating the operating economics of the 108-seat 195 to launch services on thinner routes, he adds.

The 170 is set for Brazilian CTA certification in June. European Joint Aviation Authorities approval is expected in July, with delivery to launch customer Swiss Air Lines set for August. The stretch variant 175 is set for first flight in June and should be certificated by the end of the year, says Lima.

Source: Flight International