Embraer President and CEO Francisco Gomes Neto is confident the Brazilian manufacturer’s commercial aircraft delivery volume will continue its steady recovery, reaching pre-downturn levels of 90-100 aircraft per year by mid-decade.
This year “is expected to be the year with the highest number of E2 deliveries since the program was launched,” Gomes Neto said on the company’s 2023 second quarter (Q2) earnings call. “We believe the E2 family is on the rise in the market, and this is going to be in the following years as well. We expect to be between 90 and 100 total aircraft deliveries by 2025, and most of them will be E2s.”
Embraer’s annual commercial deliveries ranged between 89 and 108 for the decade before the downturn before falling to 44 in 2020, company figures show. In 2022, they were back up to 57.
The company is targeting 60-70 commercial deliveries in 2023. Embraer handed over 24 in the first two quarters.
Deliveries of the new E2 family started in 2018 and topped out at 21 in 2021. This year’s activity includes 12 E2 deliveries through June 30.
The company’s commercial backlog stood at 271 on June 30—82 E175s and 189 E190-E2/E195-E2s.
Embraer remains confident that its E2 family will win customers in emerging markets where the aircraft complements existing fleets. Its most-often cited example is China, where the E2s could fit between COMAC ARJ21 regional jet and the COMAC C919. “Our E2s, they go exactly in the middle, and they would help a lot to improve the efficiency of the Chinese air traffic,” Gomes Neto said.
The company said it has $700 million in commercial orders from undisclosed customers that will be booked in the third quarter.
“We promise to you to disclose as soon as we have an agreement with the customers,” Gomes Neto said.
Embraer’s Executive Aviation business saw Q2 revenues jump 42% year-over-year to $378 million thanks to more deliveries and a favorable mix. Embraer delivered 30 business jets in the quarter—up from eight in the first quarter—including 11 of its larger Praetors and 19 Phenoms.
“Strong demand continues for Phenom and Praetor aircraft, as the year-to-date book-to-bill ended the second quarter at 2-to-1,” Gomes Neto said. “We have a very comfortable situation today year-to-date, with the book-to-bill ratio of 2-to-1. In the long term, we expect the market to normalize, going back to pre-pandemic levels. This means a book-to-bill closer to 1-to-1.”
This shift will be accompanied by increasing delivery volumes, Gomes Neto added. Embraer delivered 102 executive jets in 2022 and is on track to beat that figure by at least 20% in 2023, he said. First-half deliveries came in at 38.
Embraer posted a Q2 adjusted net profit of $57.9 million, a 25% year-over-year increase.
Consolidated company Q2 revenues totaled $1.3 billion, a 27% year-over-year increase. Commercial booked $471.9 million in Q2 revenue, a 57% jump. The company’s growing services business recorded Q2 revenue of $339.7 million, a 6% increase.
