May 29, 2019, © Leeham News: Embraer, in what will be its last 20-year market forecast as an independent company, sees a demand for 10,550 jet and turboprop aircraft from 50 to 150 seats through 2038.
The company, founded 50 years ago, growing to become the world’s third largest supplier of airliners, sees its Commercial Aviation unit disappear by the end of this year, barring a hiccup of some kind.
That’s when The Boeing Co. and Embraer expect approval of a joint venture that will be called Boeing Brasil-Commercial (BB-C). Boeing will own 80% of the JV and control governance. Embraer will own 20%. The CEO of the Commercial Aviation unit, John Slattery, will be president of the joint venture, but Boeing will be in charge.
Until then, Embraer is trying to carry on business as usual. And this means it issued its 20-year forecast Monday during its pre-Paris Air Show international media briefing at its headquarters in Sao Jose dos Campos, Brazil.
Forty-five percent of the demand will be for replacement and 55% for growth, said Rodrigo Souza, VP of marketing.
The 10,550 number is flat compared with last year. There were some inconsequential shifts within regions.
Asia-Pacific demand is now 2,990 airplanes, almost even with last year’s forecast of 3,000.
North America is now forecast to need 2,780 aircraft over 20 years, compared with the same a year ago.
Latin America is up by a mere 10 airplanes, to 1,150.
The complete forecast was not released at the media days; it is likely to be revealed at the air show.
Souza said the “big” opportunities will be in the US for small, narrowbody aircraft.
The Airbus A220 (formerly the Bombardier C Series) has been selected by Delta Air Lines, Jet Blue and start-up Moxy Airlines, which combined ordered more than 200 aircraft last year with nearly an equal number of options.
Embraer commands the 76-seat market with its E175-E1, but the E190/195 Series hasn’t made a dent. The larger two models don’t meet US pilot contract Scope Clause restrictions of weight and seats. The A220 is being flown by main line Delta pilots, and if Embraer—or BB-C—wants to sell the bigger airplanes in the US, these will have to be flown by mainline pilots.
The E175-E2 does not comply with Scope, either, due to exceeding the weight limit. But Embraer is going ahead with producing the prototype.
The E2s have more range, better economy and the 175-E2 and 195-E2 carry more passengers than their E1 predecessors.
Maintenance intervals are extended and the Pratt & Whitney Geared Turbo Fan engines are up to 20 dB quieter than the GE CF-34 engines on the E1s.
The first E190-E2 was delivered last year; only six have been delivered to date. The E195-E2 was recently certified and the first delivery will be in the third quarter to Brazil’s Azul Airlines.
Slattery, the CEO, expects sales to pick up now that the 195 has been certified. Sales of the E2 family have been slow, and the 175-E2 has no firm orders.