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Airline Market & Embraer Programs OverviewsA perspective from the 30 to 120-seat segment
Airline Market & Embraer Programs OverviewsA perspective from the 30 to 120-seat segment
Nov/2007 Nov/2007
Mauro Kern
Exec. VP Airline Market
Embraer Day 2007Nov 14th, 2007
Embraer Day 2007Nov 14th, 2007
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
� Air Transport Industry Review
� 50-seat Regional Jet Market & the ERJ145 Family
� 70 to 120-seat Market Evolution & the E-Jets
� Embraer Market Forecast
Contents
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Strong Air Transport Demand
Source: ICAO - Contracting States - Scheduled Airlines
0.0
0.5
1.0
1.5
2.0
2.5
3.0
3.5
4.0
4.5
5.0
19
91
19
92
19
93
19
94
19
95
19
96
19
97
19
98
19
99
20
00
20
01
20
02
20
03
20
04
20
05
20
06
20
07
F
20
08
F
To
tal R
PK
(T
rillio
n)
3.5% 6.2% 5.7%
RPK Average Annual Growth Rates
-0.4% 9.5%
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0
2
4
6
8
10
12
14
1Q00
2Q00
3Q00
4Q00
1Q01
2Q01
3Q01
4Q01
1Q02
2Q02
3Q02
4Q02
1Q03
2Q03
3Q03
4Q03
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
3Q06
4Q06
1Q07
2Q07
CA
SM
(U
S¢
/AS
M)
• 2Q 2007 Fuel costs = 24% & Labor = 25% of Ops Cost, while 12% & 34% in 2Q2000.
• Fuel costs are offsetting labor cost restructuring savings.
• Cost Control: Total Cost (Excluding Fuel) has remained flat since 2002.
Source: ATA (Airline Cost Index)
Strong Effort to Reduce Costs vs. Fuel Increase
Total Cost
Total Cost (excl. Fuel)
Labor
Fuel
US CASM data
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Positive Net Results Projected for 2007 & 2008
Source: IATA Economics Sep/07 (ICAO data to 2006 and IATA Forecast 2007-2008)
Europe
Values in US$ Billions
US net results includes restructuring costs andexcludes United Airlines ‘fresh-start’ accounting losses and gains
AfricaLatin America
North America
Middle East
Asia Pacific
World
05 06 07F2004 08F
-6.7 -2.7 2.7-10 2.5
1.6 1.8 2.11.1 3.0
05 06 07F2004 08F
0.2 0.2 0.20.2 0.3
05 06 07F2004 08F
-0.1 -0.2 -0.10.1 0.1
05 06 07F2004 08F
-0.4 -0.4 -0.1-0.3 0.0
05 06 07F2004 08F
1.2 0.8 0.73.4 2.0
05 06 07F2004 08F
-4.1 -0.5 5.6-5.6 7.8
05 06 07F2004 08F
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
TP
< 3
0
TP
30-6
0
TP
61-9
0
Jet
30-6
0
Jet
61-9
0
Jet
91-1
20
Jet
121-1
45
Jet
146-1
75
Jet
176-2
10
Jet
211-3
00
Jet
301-4
00
Jet
>400
Nu
mb
er
of
Air
cra
ft (
Un
its)
> 30
26-30
21-25
16-20
11-15
6-10
0-5
Source: BACK (Sep/07)
WW Fleet Profile - 18,914 aircraft
Scheduled Airlines, All Passenger Configuration and Active in Service
Age (years)
941
1,751
462
2,057
3,531
921
3,563
1,040
509
1,088
1,4211,630
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Environment: becoming a Critical Issue
Increasingly negative public
image >> a pollution symbol
Current main focus from NGOs,
media, and politicians
The main driver for next
generation engines and aircraft
Industry working to present real
facts, based on technical and
economic arguments
but…
Aviation is currently responsible for
2.9% of all CO2 emissions, and expected
to increase to 3.3% by 2050*.
97.10%
2.90%
All Other Sources
Aviation
96.70%
3.30%
All Other Sources
Aviation
2006 2050
*IPCC Report Aviation and the Global Atmosphere (1999; scenario FE1); IPCC Report on Emissions Scenarios (2000; Scenario A1F1) and BACK (2006)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Air Transport Industry Main Drivers
• New Passenger Profile � Different Set of Values (pricing, comfort,
more frequencies and direct services)
• Increased Competition � Pressure for Differentiated Services
• Weak Revenue Environment � Requires Continuous Cost Reductions,
Improved Productivity and Efficiency
• Regulatory: Liberalization � Opportunities for New Entrants
• Regulatory: Environment � Increased Costs – may reduce demand
• Old Fleet � Additional Costs: Fuel & Maintenance
• Fuel Prices � Increased Costs – may reduce demand
• Demand vs. Capacity � Need of a Better Match of Market
Demand and Aircraft Capacity
Driver Consequence
ERJ 145 Family
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
51
51
-
-
FirmBacklog
864131915Total
682131733ERJ 145
74-74ERJ 140
108-108ERJ 135
DeliveriesOptionsFirm
Orders
ERJ 145 Family Order Book
(September 30th., 2007)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Dec 1998Dec 1998
Dec 1999Dec 1999
Aug 2000Aug 2000
Mar 2001Mar 2001 Sep 2001Sep 2001 May 2003May 2003
Dec 1996Dec 1996
First DeliveryFirst Delivery
May 2002May 2002 Feb 2005Feb 2005May 2004May 2004
1,000 ERJ145 Platforms Already Delivered
September, 2007
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Market Share - World (30-60 seats)
45
32
17
7
52
48 47 45 46 4745 4748
5252
48
5556 55 54 53
68
83
93
53 53
0
10
20
30
40
50
60
70
80
90
100
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Oct/07
(%)
Embraer: ERJ 145/140/135
Bombardier: CRJ100/200/440
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
RJ50s Current Situation
• Worldwide FIS (Sep/07): 2057 aircraft
• 66% in the US; 13% in Europe; 9% in the CIS and 12% in ROW
• Parked aircraft (in storage): 22 CRJs; 2 ERJs; 17 others
• only 2% of the total fleet – a stable market
• RJ50s: responsible for nearly 30% of US domestic departures
• China´s regional airline industry starts to develop; FIS = 73 RJ50s
• Secondary market being developed: Mexico, Eastern Europe and
Africa
Source: BACK (Sep/07; FIS=Scheduled airlines and A/C active in service)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
China: New Opportunities for Regional Airlines
• Will operated 50 145s+ 50 E190s.
• Started operation with 328s, which will be gradually
phased out along the introduction of ERJ145
• Started operation in September 2006 with used RJ50s
leased from Shandong airlines that also provides pilots.
• Plan a fleet of 50-100 aircraft in the long term.
• Started operation in September 2007 with used RJ50s
leased from Mesa
• Looking for a fleet of 160-200 aircraft including 50 and
100 seaters
China Express
Kunpeng (Shenzhen & Mesa JV)
Grand China Express (Hainan)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Source: BACK (Mar/07)
RJ50 Market Opportunities – Russia/CIS
187 188149
0
50
100
150
200
Turboprop Jet 30-60 Jet 61-90
Nu
mb
er
of
Air
cra
ft
An-24
50 seats
Avg. Age
35 years
Yak-40
30 seats
Avg. Age
32 years
Tu-134
76 seats
Avg. Age
29 years
Old fleet replacement is needed in the short term: 524 aircraft affected
Replacement already started: Dniproavia / ERJ145; Soyuz / EMB120
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
ERJ135 / ERJ140 Higher Density Studies
•ERJ 135 = 37 seats ���� ERJ 135HD = 41 seats
•ERJ 140 = 44 seats ���� ERJ 140HD = 48 seats
• Removal of aft lavatory and Installation of a new lavatory at aircraft fwd.
• Add one four abreast row where lavatory was originally installed.
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
ERJ 145 Family Shedule Reliability Status
ERJ145 - SCHEDULE RELIABILITY AND COMPLETION RATE
97.00
97.50
98.00
98.50
99.00
99.50
100.00
JA
N
FE
BM
AR
AP
R
MA
Y
JU
N
JU
LA
UG
SE
P
OC
T
NO
VD
EC
JA
N
FE
B
MA
R
AP
RM
AY
JU
N
JU
L
AU
GS
EP
OC
T
NO
V
DE
C
JA
NF
EB
MA
R
AP
R
MA
YJU
N
JU
L
AU
G
SE
P
OC
TN
OV
DE
C
2005 2006 2007
SR
& C
R (
%)
SR CR
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
9,00
10,00
2002
Q4
2003
Q1
2003
Q2
2003
Q3
2003
Q4
2004
Q1
2004
Q2
2004
Q3
2004
Q4
2005
Q1
2005
Q2
2005
Q3
2005
Q4
2006
Q1
2006
Q2
2006
Q3
2006
Q4
2007
Q1
2007
Q2
2007
Q3
2007
Q4
US
$ M
illi
on
s
ERJ-145
CRJ-200
RV@ 12 years
Residual Value Evolution (RJ50s)
Source: average of 12 representative industry Appraisers
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
RJ 50s Future Market Trends
• Market entered a mature phase in the US and Europe
• RJ50s will remain the backbone of US hub feeding system
• Some new market opportunities (long and thin) in the US and EU
• Potential for regional aviation development in China and Russia
• Secondary market will keep expanding
E-Jets FamilyHelping airlines
to improve efficiency
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Family
EMBRAER 170• 70 to 80 Seats• 2,100 nm Range• Certification – February 2004
EMBRAER 170/175
EMBRAER 190/195
EMBRAER 175• 78 to 88 Seats• 2,000 nm Range• Certification – December 2004
EMBRAER 190• 98 to 114 Seats• 2,400 nm Range • Certification – August 2005
EMBRAER 195• 108 to 122 Seats• 2,200 nm Range• Certification – June 2006
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Family - Main Applications
� Natural evolution for existing 50-seat markets
� Right-sizing of low load-factor narrow-body flights
���� Capacity, range & seamless service
���� Enhancing services by increasing frequencies
� New market opportunities – low risk development
���� Medium density and long/thin markets
� Replacement of old & inefficient jets
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0%
20%
40%
60%
80%
100%
2000
2007
2000
2007
2000
2007
2000
2007
2000
2007
2000
2007
AS
M O
ffe
red
30-60 61-90
US Regionals: Trend towards high capacity aircraft
Capacity Share by Segment - Jets
Source: BACK
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
30% of 61-120 fleet
(735 acft) with more
than 20 years
0
100
200
300
400
500
600
700
800
0-5 6-10 11-15 16-20 21-25 26-30 31-35 >35
Age (Years)
Nu
mb
er
of
Air
cra
ft
Source: BACK (Oct/06)
World Market Opportunities – Replacement
World Fleet Age Profile (61-120 seats): 2,454 jets / 15 years average age
152,454World
838China
19241Asia Pacific
1648Middle East
22148Africa
23231Russia & CIS
11617Europe
23285Latin America
10846North America
Avg. Age
# Acft.Region
735 aircraft will be eligible for replacement in the coming years;
retirement may be antecipated due to fuel costs
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
*500 nm sector, 100% Load Factor.
0%
20%
40%
60%
80%
100%
120%
140%
160%
E170 E175 BAe 146-
100
BAe 146-
200
F70 RJ85 DC9-10
+53%
Comparison: Fuel / CO2 Emissions
CO2 Emissions*: 61 to 90-seat segment
The E-Jets Family offers substantial fleet renewal benefits with fuel / emission reductions up to 50%.
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0%
20%
40%
60%
80%
100%
120%
140%
160%
E190 E195 B717 B737-
200
B737-
300
B737-
500
F100 MD87 RJ100 DC9-30
+50%
Comparison: Fuel / CO2 Emissions
CO2 Emissions*: 91 to 120-seat segment
*500 nm sector, 100% Load Factor.
The E-Jets Family offers substantial fleet renewal benefits with fuel / emission reductions up to 50%.
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Short Term Fleet Renewal Benefits
E-Jets can bring immediate fuel / emissions savings of up to 50%
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Joint Certification means Flexibility
Same Type Design for ANAC, FAA and EASA
EASAFAA
Market swap flexibility
Increased residual value
July 2006July 2007June 2006EMBRAER 195
January 2005August 2006December 2004EMBRAER 175
June 2006September, 2005August 2005EMBRAER 190
February 2004February 2004EMBRAER 170
EASAFAAANAC
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Training Qualification Differences : According to FAA AC 120- 53, grades range from A (best) to E (worst) in 3 categories: Training Differences, Check Differences and Recurrent Training
E-Jets Commonality
Training ���� 70% of the potential benefits
same cockpit, common systems and fly-by-wire technology mean maximum training commonality within the family
-------A/A/AA/A/AA/A/A195
A/A/A-------A/A/AA/A/A190
A/A/AA/A/A-------A/A/A175
A/A/AA/A/AA/A/A-------170
195190175170EMBRAER
E-Jets have the maximum training commonality (A/A/A)
E-Jets offer an outstanding parts commonality (86% to 100%)
Spare Parts ���� 30% of the potential benefits
E190
E195
86%
E170
E175
Based on the aircraft RSPL (Recommended Spare Parts List)Note: Airframe and Ground Servicing Equipment only (Engines are not included).
100%
100%
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
“Passengers love this aircraft for its spacious interior design and in particular the absence of a middle seat.” Bryan Bedford, CEO Republic Airways (Jul/06)
“The comfort of the E175 aircraft is important to our customers and theeconomics of the aircraft make good business sense.” Scott Kirby, US Airways EVP Sales
and Marketing (Jul/06)
The Comfort Factor
CRJ700/90017.3”
16”
EMBRAER 170/190
18.25”
19.75”
A318/32018.0”
19”
Widest seats
Widest aisles
No middle seats
0.25” (0.6 cm) wider seats
0.75” (1.9 cm) wider aisle
Equal volume per seat
0.95” (2.4cm) wider seats
3.75” (9.5cm) wider aisle (+23%)
16% more volume per seat
E170/190 advantages:
E-Jets: Narrowbody airplane comfort in more convenient sizes
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
51355368
60586310
7563
0
1000
2000
3000
4000
5000
6000
7000
8000
E170 E175 E190 E195 A319 /
B737-700
US
$ p
er
Tri
pThe Trip Cost Factor
US Domestic
Network Airline -
800 sm trip
Costs exclude: revenue related costs and system (overhead) costs
Costs include: variable: fuel, crew, maintenance, landing fees, handling fees ; ownership: lease cost, hull insurance, spares inventory costs
2-class seating: 70 78 94 104 124
Airplane Variable
plus Ownership
Costs per Trip
- 32%- 20%
E-Jets: Lower trip costs than comparable airplane sizes
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Air Canada – Merrill Lynch Global Transportation Conference (Jun/2007)
COPY
Domestic
International
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
42106552EMBRAER 195
420
292
60
26
FirmBacklog
292756712Total
99432391EMBRAER 190
46136106EMBRAER 175
137123163EMBRAER 170
DeliveriesOptionsFirm
Orders
E-Jets Family Order Book
(September 30th., 2007)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Market Share - World (61-120 seats)
252
38
232122
17
46464444
4032
3639
38
4442
33 34
25
57
911
100 100
99
60
28
17 16 16
4
121621
2930
69
82
52 2
0
10
20
30
40
50
60
70
80
90
100
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Oct/07
(%)
Embraer: 170/175/190/195
Bombardier: CRJ700/900/1000
Airbus: A318
Boeing: B737-600
AVIC I: ARJ-21
Sukhoi: Superjet 100
Antonov: An-148
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
60
110 112 118
245
343
440
712
619
0
100
200
300
400
500
600
700
800
1999 2000 2001 2002 2003 2004 2005 2006 Sep/2007
Accu
mu
late
d F
irm
Ord
ers
E-Jets Customer Base Evolution
Source: Embraer
Deliveries
1 2 3 4 9 14 19 29 40Customers/Operators
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Worldwide Distribution
Growing and diversified customer-base across five continents.
Increased presence in emerging markets with established carriers.
10%
18%53%
14%
5%
Asia Pacific /China
Middle East /Africa
Europe
Latin America
North America
19%
26%
19%19%
17%
Customers Firm Orders
Source: Embraer (Sep/07)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0
50
100
150
200
250
300
350
1Q04
2Q04
3Q04
4Q04
1Q05
2Q05
3Q05
4Q05
1Q06
2Q06
3Q06
4Q06
1Q07
2Q07
3Q07
Ac
cu
mu
late
d D
eli
ve
rie
s (
un
its
)
E-Jets Delivery Pace Evolution1st Delivery -
Mar/2004 200th: Dec/2006100th: Oct/2005 300th: Oct/2007
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
13 E175
4 E170
28 E170
E-Jets
Sep/07
16 E170
49 E1908 E190
32 E1754 E175
11 E19015 E175
34 E190
190183
13 E17528 E170
17 E175
72 E19029 E190
BacklogDeliveries
Source: BACK (4Q06), Embraer
E-Jets Deployment in North America
40% 42% 18%
0% 20% 40% 60% 80% 100%
Natural Growth Right-sizing New Routes
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E170 Denver – Dayton
942 nm ; 2:47 (1 Daily)
E170 Edmonton – Chicago
1,231 nm; 3:10 (1 Daily)
E190 Boston – Austin
1,470 nm ; 4:10 (1 Daily)
E190 New York-Calgary
1,768 nm ; 5:20 (2 Daily)
Airline
E175 Philadelphia – Houston
1,150 nm ; 3:30 (2 Daily)
E170 New York – Austin
1,316 nm ; 4:10 (1 Daily)
Longest Route
Source: BACK (Jul/07)
E-Jets Deployment in domestic long haul
Efficiency and flexibility also for long haul domestic/transborder markets
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
2 E195
10 E190
10 E195
5 E190
6 E170 6 E190
4 E190
30 E190
8 E1956 E195
6 E19010 E170
4 E190
6 E170
E-Jets
Sep/07
83 48
10 E1706 E175
2 E170
BacklogDeliveries
Source: BACK (4Q06), Embraer
41% 53% 3%
0% 20% 40% 60% 80% 100%
Natural Growth Right-sizing New Routes
E-Jets Deployment in Europe
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Deployment in Middle East & Africa
2 E170
1 E1702 E170
6 E170
15 E170
E-Jets
Sep/07
628
1 E170
2 E175
1 E195 4 E195
BacklogDeliveries
Source: BACK (Jan/07), Embraer
5% 86% 9%
0% 20% 40% 60% 80% 100%
Natural Growth Right-sizing New Routes
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
1 E170
1 E170
2 E170
3 E175
5 E1902 E190
10 E170
50 E190
E-Jets
Sep/07
8410
5 E170
14 E1901 E170
BacklogDeliveries
Source: Embraer
E-Jets Deployment in Asia Pacific & China
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Deployment in Latin America
20 E195
4 E190
2 E1902 E170
1 E190
2 E170
5 E190 10 E190
8 E190
E-Jets
Sep/07
3224
1 E1901 E175
BacklogDeliveries
Source: BACK (3Q07), Embraer
27% 58% 15%
0% 20% 40% 60% 80% 100%
Natural Growth Right-sizing New Routes
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets – more than 1,000,000 Flight Hours
(*) Air Canada, Finnair and TAME operate aircraft of both subfamilies
Operators 18 Operators 11
Aircraft in Service 181 Aircraft in Service 109
Flight Hours 861,698 Flight Hours 238,362
Flight Cycles 608,493 Flight Cycles 149,492
Fleet Leader Fleet Leader
Flight Hours (Republic S/N 0016) 9,430 Flight Hours (Air Canada S/N 0013) 4,974
Flight Cycles (Republic S/N 0016) 6,618 Flight Cycles (JetBlue S/N 008) 3,402
Operators*
Aircraft in Service
Flight Hours
Flight Cycles
1,100,060
757,985
E170/190 Family
E170/175 E190/195
26
290
Source: Airlines (as of Sep 30th, 2007)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E170/190
2006 2007 2008 2009
New Higher Thrust
Engine Version
CF34-10E7
HUD Repeater
+
LVTO 170 �
�
E-Jets Continuous Product Evolution
EFB
CAT III B 170
CAT III A Autoland190
CAT III HGS 195
CAT III A Autoland 175
CAT III HGS 190
Steep Approach 170
�
�“… (E-190 flightcrew) will be able to fly every approach the same way, in good weather and in bad, from the left seat or the right seat, to ILS-equipped runways or on non-precision approaches”Usto Schutz, JetBlue’s VP (E190 Program)
“… (E-190 flightcrew) will be able to fly every approach the same way, in good weather and in bad, from the left seat or the right seat, to ILS-equipped runways or on non-precision approaches”Usto Schutz, JetBlue’s VP (E190 Program)
�
�
�
ETOPS 190 (75’)�
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
2006 2007 2008 2009
CAT IIIA Autoland 195
• Steep Approach 190
E175 AR
E170 AR
…creating value to customers.
E-Jets Continuous Product Evolution…
ETOPS 190 (120’’)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E170/175 Schedule Reliability Status
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E190/195 Schedule Reliability Status
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0,00
1,00
2,00
3,00
4,00
5,00
6,00
7,00
8,00
9,00
10,00
11,00
12,00
13,00
14,00
15,00
16,00
2002
Q4
2003
Q1
2003
Q2
2003
Q3
2003
Q4
2004
Q1
2004
Q2
2004
Q3
2004
Q4
2005
Q1
2005
Q2
2005
Q3
2005
Q4
2006
Q1
2006
Q2
2006
Q3
2006
Q4
2007
Q1
2007
Q2
2007
Q3
2007
Q4
US
$ M
illio
ns
Embraer 190
Embraer 195
B737-600
A318
RV@ 12 years
Residual Value Evolution (100 seaters)
Source: average of 12 representative industry Appraisers
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
70 to 120-seat Future Market Trends
Traffic growth on high load factor RJ50 routes
Capacity increase on RJ50 routes at peak hours
Mainline service level on regional routes
LO
W C
OS
TN
ET
WO
RK
RE
GIO
NA
L
Right-sizing of low load factor narrow-body flights
Replacement of old and inefficient jets
Expansion into medium density markets
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Embraer´s main actions towards a cleaner environment
• Embraer was the first aircraft manufacturer to obtain ISO 14001 certification in March 2002.
• Embraer is the first aircraft manufacturer to produce a 100% biofuel powered aircraft (Ipanema).
• Embraer is improving efficiency of its current aircraft portfolio and investing in the development and implementation of new technologies.
• Replacement of old jets can produce emissions reduction of up to 50% in the short term.
• Embraer is putting big efforts in cleaning its production processes.
• Embraer is fully committed to develop new products that will help the aviation industry to reduce its environmental impact.
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
NEW Market Forecast (2008-2027)NEW Market Forecast (2008-2027)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
0% 1% 2% 3% 4% 5% 6% 7% 8%
World
North America
Europe
Asia Pacific
CIS
Africa
Latin America
Middle East
China
Average Annual Growth (%)
RPK
GDP
Projected Traffic and Economic Growth
Growth by Region (2008-2027)
Projected world GDP growth around 3% in the next twenty years
sustaining nearly 5% annual increase in air transport demand
Source: Global Insight and Embraer (Oct/06)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Jet Deliveries by Capacity Segment
4,3004,300
1,9501,950
1,5251,525
825825
2018 2018 -- 20272027
7,4507,450
3,7503,750
2,6002,600
1,1001,100
2008 2008 -- 20272027
3,1503,150TOTALTOTAL
1,8001,80091 91 -- 120120
1,0751,07561 61 -- 9090
27527530 30 -- 6060
2008 2008 -- 20172017SegmentSegment
Embraer Market Forecast (2008-2027)
30-60: Mature market, low 50-seat demand in the short/mid term.
61-90: 75-seater as a natural growth of RJ50s.
91-120: Right-sizing of narrowbody operations, replacement of old &
inefficient jets and airline expansion into mid-density markets.
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Projected Deliveries (30-120 seats): 7,450 Jets
NorthAmerica
3,33045%
Europe
1,35018% China
73010%
LatinAmerica
5808%
Africa
2203% Asia
Pacific
5407%
MiddleEast
1902%
CIS
5107%
Embraer Market Forecast (2008-2027)
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
Market Share - World (30-120 seats)
59
52
47
21
45424244
38
34
24
11
5
47474545
52
44
4850505150
44
51
44
233
3
3738
23
14
84 4 4
2345
88
23
2 121 10
10
20
30
40
50
60
70
80
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 Oct/07
(%)
Embraer: ERJ 145/140/135 ; Embraer 170/175/190/195
Bombardier: CRJ100/200/440/700/900/1000
Airbus: A318
Boeing: B737-600
AVIC I: ARJ-21
Sukhoi: Superjet 100
Antonov: An-148
T h e i n f o r m a t i o n c o n t a i n e d h e r e i n i s p r o p e r t y o f E m b r a e r a n d s h a l l n o t b e c o p i e d o r u s e d w i t h o u t E m b r a e r ´ s w r i t t e n c o n s e n t
E-Jets Around the WorldE-Jets Around the World
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