Posts

Embraer’s waiting list for new business jets reaches 2.5 years

As Embraer’s deliveries of business jets totaled 52 units by September, plane maker is under pressure on the fourth quarter to meet this year’s target of 100 units

11/30/2022

Those interested in buying a new Embraer business jet currently face a waiting line of 2.5 years, as the Brazilian company’s production slots are fully booked by then. The arrival of parts is also delayed, a situation expected to normalize only in 2024.

The demand for business jets, especially the small ones, gained momentum with the Covid-19 pandemic and benefited the Brazilian company, which is the global leader in the segment. For 10 years now, Phenom 300 has been the world’s best-selling aircraft in its category. Still, bottlenecks in the supply chain have limited airplane production in general and required manufacturers to do a lot of tactical planning.

As Embraer’s deliveries of business jets totaled 52 units by September, the company is under pressure on the fourth quarter to meet this year’s target of 100 units.

The scenario is relatively similar in commercial aviation, a business that suffers in particular from a lack of engines. Embraer’s orders have not yet returned to the level seen before the pandemic. Embraer delivered 27 E175 and E195-E2 aircraft by September, less than half the target for the year.

“We have the challenge of delivering 60 aircraft in the commercial aviation business and 100 business jets. We are confident that we can reach the target, but we can miss one or another aircraft and still meet the revenue guidance,” said Antonio Carlos Garcia, Embraer’s chief financial and investor relations officer, on Tuesday.

The company foresees delivering between 60 and 70 commercial aircraft and 100 to 110 business jets this year and had already indicated that it is likely to reach the floor of these ranges.

In the world market for jets with up to 100 seats, the Brazilian plane maker has an 86% share and is likely to reach 95% in the future, because of the limited number of competitors in this segment. The United States is the main market, but Latin America has been developing as well, said Mr. Garcia.

“Who is buying? A lot of new people that buy smaller jets when they join the market,” he said. For the coming years, Embraer’s business aviation business is expected to sell 100 to 120 units a year.

In commercial aviation, the lack of pilots in the United States, the financial crisis faced by airlines, and the lack of engines have curbed sales in volume. In the global market of jets with 100 to 150 seats, the company estimates its market share at 30%. “Embraer will probably need at least two years to operate with higher volumes,” he said.

Embraer, the third-largest plane maker in the world, is on track to post net sales of $8 billion in 2026 if the average pace of revenue growth of 12% seen in recent years is maintained. The future contribution of Eve, the urban air mobility subsidiary, is not included in these projections.

In 2019, before the crisis triggered by the pandemic and the end of talks with Boeing involving the commercial aviation business, Embraer reported net sales of $5.4 billion. For this year, the company expects a range between $4.5 billion and $5 billion. However, due to hurdles in the supply chain, the company’s revenue is likely to be between $4.6 billion and $4.7 billion, said Mr. Garcia.

As for the consolidated operating results, Embraer projects this year an adjusted EBIT margin of 3.5% to 4.5% and an adjusted EBITDA margin of 8% to 9%. The actual results could be even better, according to the executive.

The bottom line is expected to be “slightly negative” in 2022, compared with the original projection of profit. Adjusted cash flow, which returned to positive territory in 2021 after two years of burning cash, could be “much better” than a positive $150 million if year-end deliveries come in on schedule. “The people didn’t stop to watch the Brazilian team’s World Cup game Monday because of the number of planes we have to deliver. The parts are arriving at very short notice to finish the aircraft,” he said.

*By Stella Fontes — São Paulo

Source: Valor International

https://valorinternational.globo.com/
/by

With E2 jets, Embraer advances on competitors’ territory

Brazilian company, the world’s leading maker of aircraft with up to 150 seats, has been gaining customers in other segments

10/24/2022

Embraer estimates that the global demand for new aircraft of up to 150 seats in the next 20 years will be 10,950 units — Foto: Divulgação

Embraer estimates that the global demand for new aircraft of up to 150 seats in the next 20 years will be 10,950 units — Foto: Divulgação

Embraer, the leading maker of aircraft with up to 150 seats, has been gaining strength to advance on its rivals’ territory abroad with the growing demand for the E-Jets E2 family. With the E195-E2, the Brazilian company has explored segments disputed by Airbus’s A220 or the smaller models in Boeing’s 737 family, and won new customers.

In July, it beat Airbus and won a firm order of 20 E195-E2 aircraft from U.S.-based Porter, worth $1.56 billion. In the same month, it reached the mark of 12 units of E195-E2 delivered to the regional division of the Dutch company KLM, which consolidated itself as the largest operator of Brazilian jets in Europe.

Just over two weeks ago, it received its first order from a Middle Eastern company, SalamAir. The firm order for six E195-E2s, with purchase rights for another six jets, drew attention because, until then, Oman’s low-cost airline only flown Airbus aircraft.

“Although it is an order of moderate size, it signals that customers flying Airbus are also studying Embraer models,” Itaú BBA analysts Daniel Gasparete, Gabriel Rezende, and Luiz Capistrano wrote in a report earlier this month. Half of the order, valued at $935 million, is expected to be included in the third quarter backlog – in June, the company’s firm order backlog stood at $17.8 billion. In the first half of the year, five E195-E2s were delivered, three of them between April and June.

On Thursday, the Brazilian company said that one of the world’s main travel companies, the European TUI, chose the E195-E2 to expand its fleet, which highlights the model’s versatility. The group will receive three aircraft through a leasing agreement with AerCap and will incorporate them into the Belgian operation.

One of the main advantages of the E2 is the 25% reduction in fuel consumption per seat compared to its first generation. In addition, it is 50% less noisy than others in its class.

Embraer estimates that the global demand for new aircraft of up to 150 seats in the next 20 years will be 10,950 units, of which 8,670 are jets and 2,280 turboprops, with a market value of $650 billion.

In a report presented during the Farnborough International Airshow, the company projected that world demand for air travel, measured in revenue passenger kilometers (RPK), will grow at 3.2% per year (considering the compound annual growth rate, CAGR) through 2041, slightly below the 3.3% rate estimated a year earlier because of the short-term slowdown in the global economy, lingering effects of the Covid-19 pandemic – considered as a region, China remains in the bottom in terms of flight resumption – and the Russia-Ukraine war.

In the battle for new orders, the Embraer E2 jets also suffered some defeats, as in the choice of Australia’s Qantas for up to 134 of Airbus’s A220 and A320neo aircraft instead of Brazilian models or Boeing’s 737 Max. Even so, the Brazilian company managed to get “dangerously” close to its rivals in the smaller segments.

In October, Embraer shares went up 7.6%. In the year, however, it is down nearly 50% after gaining almost 200% in 2021.

*By Stella Fontes — São Paulo

Source: Valor International

https://valorinternational.globo.com/
/by

Embraer expands service center in São Paulo driven by business jets

Consistent delivery of business jets during Covid-19 pandemic, increasing use of fleet contributed to decision

06/22/2022

In the next three years, 150 new workers are expected to join the center’s current 150 employees — Foto: Celso Doni/Valor

In the next three years, 150 new workers are expected to join the center’s current 150 employees — Foto: Celso Doni/Valor

Embraer, the world’s third-largest commercial plane maker, doubled the useful floor area of its service center in Sorocaba, São Paulo, in order to follow the advance of business aviation in Brazil. The expansion required investments of R$10 million.

“It is a natural growth, especially because of the business jet sales growth,” said Johann Bordais, CEO of Embraer Serviços e Suporte. The consistent delivery of business jets during the Covid-19 pandemic and the increasing use of the fleet contributed to the decision of moving forward with the project, the executive said.

The center, which started operating eight years ago and is 100 kilometers far from São Paulo, now has 40,000 square meters of useful floor area and four hangars, three of which focused on maintenance, repair and overhaul of components for Embraer planes. The fourth hangar is focused on supporting fixed-base operation.

Considering the services provided in Gavião Peixoto (São Paulo) as well, the company executes around 600 maintenance procedures a year. These procedures are expected to grow 5% to 10% a year. After the expansion, the service center in Sorocaba is now able to handle future demand and receive larger aircraft, including KC-390 Millennium.

Embraer’s center in Sorocaba offers from maintenance and overhaul services to airport services through workshops authorized for different aircraft components. The facility is also able to modify jets, including the conversion of Legacy 450s into Praetor 500s.

In the next three years, 150 new workers are expected to join the center’s current 150 employees.

In the three first months of the year, the segment of support and services contributed with revenues of R$1.4 billion, almost 46% of Embraer’s net revenues – the slice was so representative partly because commercial aviation has not resumed the pre-pandemic levels yet.

Still, this division, which currently accounts for 25% of revenues on average, is expected to gain more prominence, Mr. Bordais said. “This reflects our focus on supporting our clients.” The company expects this business to grow 10% to 15% a year around the world.

*By Stella Fontes — São Paulo

Source: Valor International

https://valorinternational.globo.com/
/by

Embraer to hire 1,000 people in Brazil

Carlos Alberto Griner — Foto: Silvia Costanti/Valor
Carlos Alberto Griner — Foto: Silvia Costanti/Valor

Embraer, the world’s third-largest manufacturer of commercial aircraft, is hiring 1,000 people in Brazil for different positions and levels in preparation for the projected growth cycle in the coming years.

Firm demand for executive jets, expectations of an upturn in commercial aviation, entry into new markets – including the launch of a cutting-edge turboprop and Eve Holding’s electric vertical take-off and landing vehicle (eVTOL) – and the expansion of affiliates underpin the opening of jobs across different units in the country.

“Hiring is the materialization of what Embraer had been indicating for the future,” Carlos Alberto Griner, the company’s vice president of people, ESG and communication, told Valor.

According to the executive, the move is aligned with the forecast that 2022 would be a year of recovery, with the resumption of growth in 2023. “Since the industry has a long cycle and requires qualification, we have to start looking at future needs with some anticipation,” he said.

In 2022, the company expects to deliver 60 to 70 commercial aircraft and 100 to 110 executive jets, compared to 48 and 93, respectively, last year – so the guidance already includes some growth.

Resumption of production at Embraer, creation of Eve, acceleration of EmbraerX, growth of Atech and Tempest, and other projects were considered in the package. “This brings a new demand for talent,” he added.

At the end of last year, the company boasted almost 18,000 employees worldwide, 80% of them in Brazil. By the end of 2022, there will be more than 19,000 employees.

The hiring comes two years after 900 workers were dismissed in Brazil as part of the efforts to face the crisis triggered by the Covid-19 pandemic and the losses from the cancellation of the sale of the commercial aviation business to Boeing. The entire aviation industry, from manufacturers to airlines, suffered from the effects of the pandemic that reduced the volume of travel worldwide.

About half of the new jobs were opened by Embraer in operation, and most of these positions are expected to be filled by people dismissed in September 2020.

According to Mr. Griner, the company will also take the opportunity to seek more diversity, in line with the environmental, social and governance commitments assumed. The working model is flexible now and can be in-person, remote or hybrid, depending on the requirements of the position. “The people strategy is to anticipate, qualify and take advantage of diversification,” he said.

Source: Valor International

https://valorinternational.globo.com

/by

Eve expected to be as large as Embraer in 10 years

Embraer’s Eve and Zanite agreed to merge air mobility businesses — Foto: Divulgação
Embraer’s Eve and Zanite agreed to merge air mobility businesses — Foto: Divulgação

In less than ten years, Eve Holding, Embraer’s urban air mobility company whose shares started being traded on Tuesday on the New York Stock Exchange (NYSE), may reach the Brazilian plane maker’s current size and become its main business. By current projections, the company is expected to reach revenues of $4.5 billion in 2030, against the $4.2 billion recorded by the aircraft manufacturer in 2021, and be at the head of a market estimated at $760 billion in 2040.

“Embraer has two lines of action: business efficiency and innovation. Eve is an example that this strategy is working,” CEO Francisco Gomes Neto, who attended the opening ceremony at Nyse along with the management team of Eve Holding, told Valor. The company already has non-binding orders for more than 1,800 eVTOLs (electric vertical take-off and landing vehicles), the so-called flying cars, which constitute a potential backlog of $5.4 billion.

Despite the figures, the debut on the American stock exchange was not smooth. Penalized mainly by the increase in interest rates, global inflation and investors’ flight from risky assets, the shares fell 23.5% in the first business session, to $8.66 each, in a movement that was already expected by analysts because of the recent negative performance of other stocks in the industry. In Mr. Gomes Neto’s evaluation, it is relevant the fact that the company has managed to move forward with the operation amid adverse market conditions.

The funds raised in the transaction — an IPO via merger with Zanite Acquisition, a special purpose acquisition company (SPAC) that was already listed at NYSE — were lower than expected. But, according to Mr. Gomes Neto, they are enough to finance Eve’s operation until eVTOL is authorized.

Initially, the estimate was that it would take about $500 million to reach certification of the aircraft, scheduled for 2025. Zanite’s financial partners, however, contributed less funds and Eve Holding raised $377 million. As a result, Embraer holds about 90% of the new company’s capital, compared to just over 80% in the original proposal.

“With more experience in relation to costs [of the project] and with competitive engineering, which is available in Brazil, the vision at this point is that the funds are enough,” the executive said.

According to Mr. Gomes Neto, one of Eve’s major distinctions in relation to its peers is being able to count on Embraer’s support, knowledge and global facilities. Other companies that are developing the so-called flying cars will have to build this structure, he pondered.

In addition, Embraer’s engineering team, which is recognized globally for its competencies, is participating in the development of the eVTOL. “We are confident that Eve’s design is simple and more favorable to operation than other designs,” he said.

The first 1:1 scale Eve prototype is due to take off in Brazil, at the Gavião Peixoto plant, in São Paulo state, in the next few weeks. There is still no decision on where the aircraft will be manufactured, and an international consulting firm has been hired to help define the assembly process. “We are going to make logistics and manufacturing network studies to decide where and how this process will be,” the Embraer CEO said.

In a note, Eve co-CEO Andre Stein called the IPO at Nyse a “historic milestone” in the journey started nearly five years ago by the startup incubated at EmbraerX. “This deal is a key enabler of our mission to become a leader,” he said.

Jerry DeMuro, also co-CEO, pointed out that the non-binding orders signed by major customers, including Azorra Aviation, Falkon Regional Aircraft, Republic Airways and Skywest, “provide powerful validation” of Eve’s business strategy and vision.

With the crisis triggered by the Covid-19 pandemic, which was especially hard on civil aviation, and the cancellation of the company’s commercial aviation sale to Boeing, Embraer had to reduce its operations and adjust to the new market reality. Eve’s success is one of the relevant axes for the company’s resumption of growth.

Source: Valor International

https://valorinternational.globo.com

/by

Embraer completes business combination between Eve, Zanite

Embraer’s Eve and Zanite agreed to merge air mobility businesses — Foto: Divulgação
Embraer’s Eve and Zanite agreed to merge air mobility businesses — Foto: Divulgação

Embraer unveiled that it has completed the business combination between its subsidiary of air vehicles for urban mobility — the so-called “flying cars” — Eve, and U.S.-based Zanite Acquisition. The merger gives rise to a new company, Eve Holding, now listed on the New York Stock Exchange. Embraer closed down 7.98% on the B3.

Embraer Aircraft Holding holds 238.5 million shares of Eve Holding common stock, representing approximately 90% of the existing common stock. The remaining shares are held by Zanite’s market shareholders — by the sponsor and certain third party investors that entered into subscription agreements to purchase common shares at the closing of the business combination, Embraer said.

“The business combination is in line with the company’s innovation and growth strategy, and its consummation reinforces the company’s commitment to achieving these goals,” Embraer said. The merger was unveiled in December last year.

In a note, Eve co-CEO Andre Stein said the transaction provides the startup with “growth capital and positions Eve well to execute its development plans, aided by our ongoing strategic partnership with Embraer.”

“We intend to further strengthen our position as a leading global UAM [urban air mobility] player by delivering an effective and sustainable new mode of urban transportation,” he added.

Co-CEO Jerry DeMur indicated that the closing of the deal puts Eve on course to continue developing its solutions.

Last week, Eve revealed that since December its order backlog rose to 1,825 units from 1,735 electric vertical take-off and landing vehicles (eVTOLs), made through non-binding letters of intent from 19 customers. Among the customers are fixed-wing operators, helicopter operators, sharing platforms, and leasing companies.

Source: Valor International

https://valorinternational.globo.com

/by

Airbus launches A220 model in Embraer’s turf

Airbus conversando com o regulador de aviação da China sobre a certificação A220 - exec - Plu7

Airbus ended Tuesday, in São Paulo, the demonstration tour of the A220 model in South America, a market where the new family of aircraft – formerly part of Bombardier’s CSeries program – has not yet won customers.

The European plane maker vows to deliver lower operating cost than large narrow-body jets and offer more seats and longer-range flights than regional jets. The plan is to grab a share of a market currently dominated by Embraer’s E-Jets, especially the E195-E2, and Boeing’s 737 Max 7.

Airbus stands as the global leader in the 100 to 150-seat segment, with a 56% share, followed by Boeing (22%) and Embraer (17%). In South America, however, the new model has yet to take off. “Last year was one of recovery. Brazilian airlines suffered a lot from the pandemic. But we already have two major operators here and expect to receive new orders later on,” said Guillaume Gressin, the company’s vice-president of international, strategy and commercial operations. Azul and Latam are major clients of the European company, with dozens of other Airbus models in operation.

Latin American airlines are taking longer than peers in other regions to recover financially from the crisis triggered by Covid-19, which helps to explain why the A220 has not yet received orders from the region, the executive said.

According to Airbus’s calculations, Latin America will need 2,460 more passenger and cargo aircraft over the next 20 years to meet the additional demand and to replace older and less efficient jets. The fleet in service in the region is expected to double in this period to 2,800 units.

Of the total number of new aircraft, 2,170 will be small, 190 medium, and 100 large, Airbus projected. The growth of the middle class and the need for jets for shorter routes will drive demand, Mr. Gressin said.

Designed to serve the 100 to 150-seat market, the A220 has already drawn more than 740 orders. Today, there are more than 200 jets flying on 600 routes, operated by over 25 clients, including Air France, Delta, JetBlue and Breeze Airways – a new airline owned by David Neeleman.

Antonio da Costa, Airbus’s vice-president of single-aisle marketing, sees room for the A220 in South America. “The A220 is complementary to Embraer’s jets. Air France, for example, operates the A220 and KLM operates the E2. This brings more flexibility to the operation,” he said.

With the A220, he added, it will be possible to cover more distant routes than those operated today by the E2, allowing the expansion of the network. Compared to the Boeing Max 7, the A220’s engines, aerodynamics and systems are more modern and include more advanced technologies, he said.

The A220-300 showed in Brazil today belongs to Swiss Airlines. Before landing in São Paulo, where it was presented to representatives of local airlines, it flew through Mexico, Panama, Chile and Argentina after leaving from Miami.

Source: Valor International

https://valorinternational.globo.com

/by

Brazil’s Embraer, airlines monitor impacts on costs, operations

Embraer engata rota ascendente após rejeição pela Boeing

Although the war in Ukraine has not affected the flights of Brazilian companies so far, planemaker Embraer and airlines Latam, Gol and Azul are closely monitoring its developments, which may have a significant impact on costs and operations in the sector.

In the case of Embraer, the international community’s sanctions against Russia may disrupt access to titanium, a light metal used to make aircraft and their engines.

VSMPO-Avisma, controlled by the state-owned Rostec, has a monopoly on the production of titanium and parts forged with the metal in Russia. And it is an important supplier to the aircraft industry. Boeing and Airbus also depend in good part on Russian titanium.

An embargo on Russia, therefore, could directly impact the largest planemakers in the world.

According to Reuters, VSMPO-Avisma accounts for 25% of global titanium supply. Specifically in the aircraft market, this share rises to 50%, according to international consultants.

Sought for comment, Embraer said it evaluates the titanium supply chain on an ongoing basis, as it does with other materials. “At this moment, the supply of titanium does not concern Embraer, since the company holds a high level of stock of this material,” the company said in a note.

In a LinkedIn post last week, Latam Brasil CEO Jerome Cadier listed potential impacts of the war for airlines and stressed that the pressure on costs is “undeniable,” also citing titanium. “Unfortunately, in the situation the industry is in, these increases will impact ticket prices. It is a shame, especially at a time when what we most want is to fly again,” he wrote.

In the executive’s view, the war in Ukraine can affect the capital market and the availability of credit and the price and supply of commodities relevant to the industry, including metal.

Sought to comment on the consequences of the war, Latam said it does not fly to Ukraine and, so far, its flights have not been affected by the closure of airspace in different countries.

Gol also reported that it does not operate flights to Ukraine and reinforced recent positioning of the Brazilian Association of Airline Companies (Abear), which already warned about potential impacts of the exchange rate and oil on the costs of the airline industry.

“About this sad moment, we inform that our members do not operate flights that have as final destination the conflict region and we follow closely the impacts on the foreign exchange rate and oil prices, which can further increase costs,” the association reported.

Azul said in a note that “its operations continue as normal and without any impact.” “A possible effect on the value of tickets will depend on the impact of the war on costs such as foreign exchange rate or oil, which are constantly monitored by the company,” it added.

Source: Valor International

https://valorinternational.globo.com

/by

Embraer’s Eve starts certification in civil aviation agency

Embraer's Eve's flying car to be certified for flying in 2025 — Foto: Divulgação
Embraer’s Eve’s flying car to be certified for flying in 2025 — Foto: Divulgação

On its way to being listed on the New York Stock Exchange (NYSE), Eve, Embraer’s urban air mobility company, started the process to obtain a type certificate for its electric vertical take-off and landing vehicle (eVTOL), or “flying car”, with the National Agency of Civil Aviation (ANAC).

This certification will confirm that the new aircraft model, which will be produced on a large scale, meets the legal criteria for airworthiness. Eve expects to certify its eVTOL in 2025 and put it into commercial operation in 2026.

According to the Brazilian aircraft manufacturer, with the initiative, Eve formalized with the regulatory body the commitment “to demonstrate compliance with international technical standards and mandatory airworthiness requirements for certification”.

The eVTOL will follow the process of obtaining the type certificate in the “normal category”. “Eve, with the support of ANAC, will continue the interactions with the main foreign aeronautical authorities, soon formalizing the type certificate validation process in accordance with its global business strategy”, it informed.

In a statement, ANAC´s Airworthiness superintendent, Roberto Honorato, stated that this is a relevant step. “The process aims to achieve the best security standards, in order to allow eVTOL access to the global market,” he said, adding that there is still a lot to be done from a regulatory point of view in relation to the new technology and to the urban air mobility ecosystem.

According to Eve’s head of technology, Luiz Felipe R. Valentini, the formalization of the certification process continues the discussions already underway with ANAC.

“In addition to demonstrating Eve’s commitment to the development of the project, it allows institutions to evolve together in defining the requirements and means of compliance applicable to certification,” he explained.

Eve’s “flying car” aims to offer comfortable transport, with low noise and zero carbon emissions. Initially, it will be manned and will have capacity for four passengers. With 17 announced partnerships and 1,735 aircraft on the order backlog, valued at $5.2 billion, Eve projects revenue of $4.5 billion in 2030 and a market share of 15%.

The merger between Eve, a startup that was incubated at EmbraerX and launched as an independent company in October 2020, with Zanite Acquisition, was announced in December. The transaction values Eve at $2.4 billion and is expected to be closed in the second quarter. Zanite is already listed on Nyse.

Source: Valor International

https://valorinternational.globo.com

/by

Embraer’s Eve will have four major business areas

Conheça a Eve, a marca de 'carros voadores' da Embraer | CNN Brasil

Eve, Embraer’s urban air mobility company, will operate in four major business areas and not only in the production and marketing of its electric vertical take-off and landing vehicle (eVTOL). On its way to being listed on the New York Stock Exchange (NYSE), it will operate in support and services, operations, and air traffic control, with the development of management software for the so-called flying cars.

“All the numbers available point to a large market. This is what attracted Embraer and led it to incubate this project in EmbraerX,” said Tuesday the Eve CEO, Andre Stein, at the Credit Suisse 2022 Latin America Investment conference.

According to the executive, this is a market of more than $750 billion by 2040, considering the urban air mobility ecosystem. For Eve, the initial conservative projections suggest potential revenue of $4.5 billion by 2030, with a 15% market share.

Launched as an independent startup in October 2020, Eve is in the process of merging with U.S.-based Zanite Acquisition, in a deal that values it at $2.4 billion. The deal was announced at the end of 2021 and is expected to close in the second quarter of 2022.

According to CFO Eduardo Couto, Eve plans to be listed at Nyse as of the second quarter. “This is a relatively new operation for Brazilian companies, mixing M&A with a traditional IPO,” he said.

Eve is joining an already listed company, which has about $237 million of cash. Another $305 million in new money will come into Eve’s cash reserves from the deal, so that after the merger the company will have raised more than $500 million to develop its project. Embraer will be the controlling shareholder, initially with an 80% stake in the company.

According to Mr. Stein, the decision to launch Eve as a company independent from Embraer will maintain the agility characteristic of startups while providing access to the resources and structure of a global leader, in this case the aircraft manufacturer. “Eve will be able to seek new partnerships very freely, and even new investors, which would not be possible as a division of Embraer,” he said.

With 17 announced partnerships and 1,735 aircraft in its order backlog, valued at $5.2 billion, Eve keeps plans to certify its eVTOL in 2025 and put it into commercial operation in 2026. The gross margin of the operation is expected to be around 25% and the EBITDA margin between 15% and 20%.

Four companies that are developing flying cars are already listed on the NYSE. But Eve’s management believes that its project is differentiated, given the size of the current order portfolio, the diversity of clients and the aeronautical knowledge of the partners, especially Embraer.

According to the executives, Eve also offers greater certification capacity, in the wake of Embraer’s accumulated experience with regulatory bodies and the close relationship between the National Civil Aviation Agency (Anac) and the FAA, the U.S. authority. According to Mr. Stein, the plan is to certify eVTOL first at Anac and then seek FAA validation. “Brazil has the potential to be one of the pioneers,” he said.

For Embraer’s Vice-President of People, ESG and Communication, Carlos Alberto Griner, electric propulsion corresponds to one of the main solutions for reducing the environmental impact of aviation — particularly in regional aviation, a market in which the Brazilian company stands out globally. “These changes will start with regional aviation. And Eve will revolutionize the market,” he says.

/by