Embraer is exploring options for bolstering production capacity in the face of a growing civil and military backlog. Adding to this is a new order for up to 80 ERJ-145s placed by Chautauqua Airlines affiliate Solitair.

The planned expansion follows a bumper year in 1999, when the Brazilian company doubled net profit to $230 million on sales of $1.89 billion, up 44%, although future success may be threatened by the outlawing of state aid received through the Pro-ex programme. The World Trade Organisation last week condemned Brazil for failing to revise the scheme after an earlier ruling.

Embraer is increasing ERJ-135/145 production to 14 aircraft a month by mid-year, six months earlier than planned. This will rise to a year-end "stabilised rate" of 16 a month, which Embraer hopes to maintain for two years. "This, combined with the new ERJ-170/190 and our military work, doesn't fit into our current facilities and certainly we will have to expand," says Embraer vice-president industrial, Satoshi Yakota.

The order from Wexford-owned Solitair comprises 15 new ERJ-145s, the conversion of 20 options and 45 additional options, with at least 15 aircraft going to Chautauqua's planned TWA regional service. It takes ERJ-135/145 orders to 612, plus 433 options, of which 225 have been delivered. Added to this are launch orders for 75 ERJ-170/190s and plans to offer corporate ECJ-170 and ECJ-135 versions.

Additionally, the Brazilian air force is negotiating for 99 EMB314 Super Tucanos, while AMX production was recently boosted by the sale of eight to Venezuela. Embraer is also selling small but growing numbers of EMB-145 military derivatives.

Embraer has begun building a 15,000m² (160,000ft²) ERJ-170/ 190 assembly and paint shop at its main Sïo José dos Campos facility, for production of up to six aircraft a month, with first deliveries set for late 2002. Expansion options include purchasing land, relocating military work or moving some civil machining/subassembly work.

Embraer has contracted ERJ-170/190 work overseas, with Kawasaki and Sonaca supplying wing components, Latecoere two fuselage sections and Gamesa the empennage. Embraer's workforce will grow from 7,700 to 12,000 people over the next five years.

The new WTO ruling says Brazil has not made the necessary changes to Pro-ex but endorses a planned revamp of the Technology Partnerships Canada programme that has benefited Bombardier.

Source: Flight International