Brazilian aerospace manufacturer Embraer is studying the possibility of developing a new passenger aircraft that could compete directly with offerings from industry giants Airbus and Boeing, according to reports from the Financial Times and The Wall Street Journal.
The project, still in its early stages, could result in plans for either a narrow-body aircraft or a long-range business jet, sources familiar with the situation told the Financial Times.
However, Embraer has downplayed these reports, stating that while it has the capability to develop a new narrow-body aircraft, the company is currently focused on selling its existing portfolio of successful products.
“We don’t have any plan for a sizeable cycle of capex at this time,” an Embraer spokesperson told Reuters.
Embraer is the world’s third-largest civil aircraft manufacturer, specializing in regional jets with up to 146 seats.
A move into the narrow-body market would pit the Brazilian company against Airbus’ A320 family and Boeing’s 737 MAX aircraft – a decision fraught with immense risk and costs that could run into the tens of billions of dollars.
Industry analysts believe Embraer will likely proceed cautiously, given the high stakes involved.
Canadian rival Bombardier’s attempt to break into the single-aisle market with its C Series nearly led to bankruptcy before the company partnered with Airbus and eventually exited the commercial aviation sector.
While Embraer has not confirmed any definitive plans, the company has stated its openness to partnerships that could open new markets for its current products. It is also exploring local production opportunities in several countries, depending on aircraft order volumes.
Embraer, considered the crown jewel of Brazilian engineering, has emerged strongly from the COVID-19 pandemic, reporting a profit of $164 million in 2023 and a seven-year high in its order backlog.
The company’s shares have risen by more than 50% in 2024, giving it a market capitalization of $4.8 billion as of Wednesday.
Source: The Wall Street Journal, Financial Times, Reuters
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