Embraer’s aircraft delivery delay seen 1 to 2 months, shorter than peers’ times, CFO says

2:28 pm Thursday, August 29th, 2024

By Gabriel Araujo

SAO PAULO (Reuters) – Brazilian planemaker Embraer’s average delay to deliver aircraft is around one to two months, the firm’s chief financial officer said on Thursday, highlighting it as shorter than the delays larger peers face.

The aviation industry has grappled with supply issues since the pandemic, forcing plane manufacturers to delay deliveries and constraining a capacity increase that would help airlines meet higher travel demand.

Engines continue to be Embraer’s biggest supply-constraint problem, CFO Antonio Carlos Garcia told reporters, but the company has avoided excessive extensions to delivery deadlines.

“We only commit to our clients when we can deliver. So there can be a delay, but one to two months maximum this year,” Garcia said. “While for Boeing and Airbus it may top a year, depending on the client.”

The two rival manufacturers did not immediately respond to requests for comment.

The Brazilian firm’s niche is the regional market for planes smaller than Boeing’s and Airbus’ best-selling 150-seat-plus market. Embraer’s E2 jets, however, directly compete with Airbus’ A220.

Embraer has experienced strong demand for its small narrowbody aircraft, such as the next-generation E2, as carriers face a shortage of larger single-aisle planes due to Boeing’s and Airbus’ extended delivery timelines.

The backlog of Embraer’s commercial-aviation unit ended the second quarter at $11.3 billion worth of firm orders, up 40% year-on-year, while the overall backlog stood at a seven-year high of $21.1 billion.

Garcia confirmed that Embraer, which expects to deliver 72 to 80 commercial aircraft this year, still has production slots available for 2026.

Recent sales included 20 E2 jetliners to Mexico’s state-run Mexicana de Aviacion and eight E190-E2 to Virgin Australia.

“Mexicana is a clear example,” Embraer investor relations head Guilherme Paiva said. “The problems that the industry faces obviously have favored companies like us, which have managed to deliver aircraft on time.”

(Reporting by Gabriel Araujo; Editing by Rod Nickel)