Brazilian aircraft manufacturer Embraer has just presented its 20-year forecast for world demand of 30- to 120-seat commercial jets, as well as for the business jet market.
The announcement was made during the 7th Embraer Day held November 16 and 17 in São José dos Campos, the company’s headquarters. At the same event, Embraer also announced its airline and business jet delivery forecast for 2007 and 2008.
Embraer foresees a global demand for 7,500 jets in the 30- to 120-seat capacity segment over the next 20 years. The company estimates that 3,050 aircraft will be delivered between 2007 and 2016, with the remaining 4,450 units to be delivered between 2017 and 2026. The total market value is estimated at US$ 220 billion, as presented below:
Market Segment (Seats) 2007-2016 2017-2026
30 – 60 300 1,100 1,400
61 – 90 1,100 1,500 2,600
91 – 120 1,650 1,850 3,500
30 – 120 3,050 4,450 7,500
The forecast indicates that the 30 to 60-seat market segment has reached maturity, but will continue to play an important role in the North American and European air transportation systems and will develop markets such as China, Mexico and Russia that have strong needs for regional aviation.
The 61-90 seat segment will continue providing natural growth to regional airlines on high demand 50-seat regional jet routes, sustaining revenue growth and market share. In addition, it will help airlines to replace ageing aircraft and will right-size aircraft capacity to market demand with improved service levels.
The 91-120 seat segment will expand to help airlines to match aircraft capacity to market demand, through ageing aircraft replacement, right-sizing of narrowbody routes with excess capacity and low-cost-carrier expansion into mid-size markets.
Commercial jets deliveries forecast for the 30 to 120-seat segment by region (2007-2016):
Region Total Deliveries Share
USA, Canada & Caribbean 3,850 51%
Europe 1,290 17%
China 630 9%
Russia & CIS 505 7%
Latin America 480 6%
Asia Pacific 385 5%
Middle East 230 3%
Africa 130 2%
Total (2007-2026) 7,500 100%
Business Jet Market
Embraer estimates an overall demand for 11,115 business jets over the next ten years, valued at approximately US$ 169 billion. The new air taxi market may add another 2,500 to 3,000 aircraft to the Very Light Jet (VLJ) segment.
Embraer entered the Very Light and Light Jet segments with the launch of the Phenom jets, in May 2005, and introduced the Lineage 1000, an ultra-large executive jet based on the Embraer 190 commercial jet platform, in May 2006.
Business jets deliveries forecast by product segment (2007-2016)
Segment Total Deliveries Share
Very Light 2,715 24%
Light 2,390 21%
Mid-light 1,080 10%
Mid-size 1,305 12%
Super Mid-size 1,250 11%
Large 1,310 12%
Ultra-Long Range 850 8%
Ultra-Large 215 2%
Total (2007-2016) 11,115 100%
Embraer says it’s enhancing its Executive Jets customer support and services offering. The company is adding four wholly-owned service centers and revamping the authorized service center network. By 2008, 45 service centers will support Embraer’s Executive Jets fleet.
A joint-venture is being established with the Canadian company CAE to develop training for the Phenom jets. Embraer is also investing heavily in parts inventory and logistics, as well as in the enhancement of its special maintenance programs.
As of today, the Executive Jets division has added US$ 1.8 billion of new contracts. Firm orders for the recently-launched Phenom 100 and Phenom 300 Very Light and Light Jets stand at over 340.
Currently, there are 87 Legacy 600 executive jets operating in 18 countries. Embraer expects to deliver 25 to 30 Legacy 600 jets per year in 2007 and 2008, up from 20 units in 2005 and 13 in 2004.
In mid-2008, deliveries of the Phenom 100 will commence, totaling 15-20 units in the second semester. In 2009, when deliveries of the Phenom 300 begin in the second semester, the production rate of the Phenom 100 and Phenom 300 is projected to reach 120-150 units combined.
Delivery of up to two Lineage 1000 jets is expected for the second semester of 2008, in its first production year. In 2009, three to four Lineage 1000 jets are planned to be delivered.
Embraer expects to deliver, in 2007, between 160 and 165 aircraft in the commercial aviation, executive aviation and defense and government (state-owned airliners and government authority transportation) segments.
For 2008, the company estimates delivery of 195 to 205 aircraft, including 15 to 20 Phenom 100 Very Light jets with deliveries expected to begin in the second half of the year.
Embraer (Empresa Brasileira de Aeronáutica S.A.) (NYSE:ERJ) (Bovespa: EMBR3) is the world’s leading manufacturer of commercial jets up to 110 seats with 37 years of experience.
With headquarters in São José dos Campos, state of São Paulo, Brazil, the company has offices and customer service bases in the United States, France, Portugal, China and Singapore.
Embraer is among Brazil’s leading exporting companies. As of September 30, 2006, Embraer had a total workforce of 18,336 people, and its firm order backlog totaled US$ 13.3 billion.
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