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Embraer Bets Post-Pandemic Travel Will Boost Regional Jets

Embraer SA expects the recent surge in travel to drive demand for regional jets as airlines look to tap new avenues of growth and replace older planes with more fuel-efficient aircraft

An Embraer SA E195-E2 aircraft at the Wings India 2022 Air Show held at Begumpet Airport in Hyderabad, India.
By Siddharth Philip
June 19, 2022 | 09:58 am

Bloomberg — Embraer SA (EMBR3) expects the recent surge in travel to drive demand for regional jets as airlines look to tap new avenues of growth and replace older planes with more fuel-efficient aircraft.

The planemaker is currently in discussions with potential customers in North America, Latin America, Europe and Asia for its E2 range of models, Arjan Meijer, the chief executive officer of Embraer’s commercial aircraft unit, said in an interview in Doha. Meijer declined to comment on the size of any potential orders but said that Embraer expects to deliver between 60 and 70 E-jets this year, up from fewer than 50 in 2020 and 2021.

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Meijer said that legacy carriers want to diversify their networks and overhaul older regional fleets by adding more fuel-efficient aircraft, addressing both higher fuel prices and the need to reduce carbon. As countries reopen borders and Covid curbs fall away, travel has sprung back rapidly.

Still, concerns remain about an unprecedented labor crunch that has left airlines and airports struggling to hire back hundreds of thousands of workers who were let go at the height of the pandemic. Spiraling inflation and economic pressures are also putting a question mark over how sustainable the current demand really is.

Meijer said that the labor issues were “growing pains” and expected them to be resolved in the short term. Inflation and the consequent increase in interest rates would raise the cost of funding for the industry, he said.