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Embraer: Taking Off at Executive Jet Speed

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Key Takeaways:

  • Embraer has rapidly expanded its executive jet portfolio, moving from one "clean-sheet" design a year ago to four currently in development (Phenom 100/300, Legacy 450/500), in addition to existing models.
  • This aggressive expansion is supported by substantial investments exceeding $850 million in R&D for new programs, new manufacturing facilities in Brazil and Florida, and a global customer support infrastructure.
  • The company's diversification into business jets is proving highly successful, evidenced by strong order backlogs (e.g., 800+ Phenom orders) and executive jet sales now contributing 16% of revenue, validating its strategic shift from a softening commercial airline market.
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Twelve months ago, Embraer’s first “clean-sheet” business jet design — the Phenom 100 — had just completed its first test flights. What a difference 12 months can make! Today, the Phenom is just one of four … count them, four … “clean-sheet” Executive Jet designs in development at Embraer.

Currently, the Phenom 100 is finishing its certification/validation test flights, with certification and first deliveries expected — as scheduled — before the end of the year. Two prototypes of the 100’s bigger brother, the Phenom 300, have already flown, and the last of four Phenom 300 flight test prototypes is nearing completion, with certification for the 300 expected in the second half of 2009. Embraer plans to deliver 10 Phenom 100s before the end of this year, and the company says it’s still on track to meet its goal of producing between 120 to 150 Phenoms in 2009.

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