Embraer 170/190 takes company to heights
By Sandra Arnoult, ATW Online | Apr. 04, 2006
Embraer reported a record year with sales topping $3.8 billion, an 11.3% increase over 2004, and net income of $446 million, a 17.2% rise.The Brazilian manufacturer's firm-order backlog was valued at $10.4 billion as of Dec. 31. Additionally, the company strengthened its financial position, with net cash of $360 million compared to $22 million on hand last year. It delivered 118 aircraft in 2005 and has a firm-order backlog of 322 170/190 aircraft. Included among 2005 deliveries were the first 190 that went to JetBlue and the first 175, delivered to Air Canada. It received a total of 94 orders for 170s/190s last year.
For the quarter ended Dec. 31, Embraer reported a net profit of $156 million, an 88% increase over the same quarter a year ago. Revenues were $1.2 billion, up from $954 million.
President and CEO Mauricio Botelho said there are no plans to shut down the ERJ-145 production line even though sales have all but dried up. The company has delivered 894 of the smaller RJs and has a firm-order backlog for 45 more. "What we see is we keep manufacturing these aircraft at a lower pace," Botelho said, pointing out that the Legacy 600 business jet is based on the 145 platform. "The production line and tooling is in place. The production line is fully working."
He said Embraer hopes to shorten the current 4.5-month production cycle for the 170/190 by about 25%. It currently is delivering about eight each month, but he hopes to push that up to 10 "very soon." He also said the company continues on a "learning curve" with the E-jet family, trying to improve performance problems associated with any new aircraft type: "When you introduce a new aircraft into an airline you have to solve a lot of problems."
Botelho said the airframer is continuing to develop its new line of very light jets, the Phenom 100/300, and may release details of an order book later this year. The aircraft, which can seat 4-9 passengers, are expected to enter service in 2008.