Company Tries To Downplay Remarks... Not Quite
An executive with Brazilian planemaker Embraer said this week
the company is reviewing the business case to develop a larger
narrowbody aircraft, including a possible partnership with another
manufacturer... but the company later took steps to downplay the
Reuters reports Embraer CFO Antonio Luiz Pizarro Manso commented
during a Tuesday conference call the company is considering whether
or not to enter the 110-130 seat airliner market. That segment is
now dominated by smaller variants of the Boeing 737 and Airbus A320
Family, though Embraer rival Bombardier hopes to poach orders from
those manufacturers with its upcoming CSeries.
"Whether we should develop a larger plane, alone or with
partners, is something that we will have to decide," Pizarro Manson
said during the call announcing Embraer's Q3 earnings. "Right now,
we think the market is well supplied by the existing models... So
our strategy is to wait a bit, especially to see what kind of
engine can be developed for such a project."
The plot thickens somewhat when you consider comments made by
Airbus CEO Thomas Enders earlier this week, during a stop in Sao
Paulo, Brazil. Enders said Monday the European planemaker was
always open to a potential partnership with Embraer... one day
before a planned visit to Embraer's production facility.
Pizarro Manso tried to downplay those remarks, to little avail.
"We're always engaged in talks, but there is nothing specific at
the moment," he said, noting Airbus parent company EADS is a
partner in Embraer's unit in Portugal.
The resulting clamor in the commercial aerospace industry forced
Embraer to 'clarify' the issue Wednesday.
"With reference to statements attributed to its Executive
Vice-President, Finance and CFO, Antonio Luiz Pizarro Manso, during
the conference telephone call for presenting the results of the
third quarter of 2008, held on November 4, Embraer publicly
clarifies that, at the present time, it is not seeking to associate
with any other aircraft manufacturer in the world, neither does it
have a project for developing large airplanes."
However, that stern rebuke was followed by a decidedly mixed
"Market trends for commercial jets have been constantly
monitored by Embraer, which always seeks placement opportunities
for its current product line. Furthermore, the Company has an
engineering department devoted to preliminary studies of new
programs and pre-competitive technological development...
initiatives for associating with other companies or for launching
products could be considered, based on a thorough study of possible
scenarios, and they would be promptly announced to the market."
On Monday, Embraer announced it lost $22.6 million net in the
third quarter of 2008. The company said it has not received any
order cancellations due to the global financial downturn, though
the situation may soon force some customers to postpone
In happier news, Embraer also said it anticipates a market for
875 regional aircraft in the emerging Chinese market.