Boeing’s interest in Embraer is self-evident. This interest goes back a long time. There are deep relationships between high-level people at both companies. But the Brazilain government is looking at the deal with apprehension. Even though Embraer (we have been advised) gets no special protection from the state, as a key shareholder, the state has concerns. As we heard this week, “control over Embraer as a very hot topic in Brazil”.
So there has been something of a maze to navigate for Boeing and Embraer managers trying to find a path forward. The news from Brazil this morning indicates such a path may have been found. Here’s a link to an English version of the original story.
Creating a third company to control the relationship, and exclude the Embraer defense business seems to be the way ahead.
Keeping the defense segment independent is very important. Brazil’s deal with SAAB for the Gripen fighter was impacted by any potential Boeing deal. SAAB’s concerns seem a bit odd, given that company’s collaboration with Boeing on the T-X. Moreover, Boeing and Embraer are already collaborating on the KC-390. Even if the Embraer defense segment is kept separate from this third company, Embraer, SAAB and Boeing are all involved with each other. Perhaps there is another company that might be created to put all those programs into a basket, too?
The devil is the details and we might not get anything on this deal at the Singapore show next week. But the Boeing and Embraer leadership will be asked anyway.
Co-Founder AirInsight. My previous life includes stints at Shell South Africa, CIC Research, and PA Consulting. Got bitten by the aviation bug and ended up an Avgeek. Then the data bug got me, making me a curious Avgeek seeking data-driven logic. Also, I appreciate conversations with smart people from whom I learn so much. Summary: I am very fortunate to work with and converse with great people.