LATAM E2
PR: LATAM Airlines Group S.A. and its affiliates today announced an agreement with Embraer and plans to expand connectivity across South America, supported by the acquisition of up to 74 Embraer E195-E2 small narrowbody aircraft. The order includes 24 firm deliveries and 50 purchase options. Deliveries of the firm aircraft will start in the second half of 2026, initially for LATAM Airlines Brazil and potentially later for other LATAM group affiliates.
This initiative underscores LATAM group’s ongoing investment in strengthening its domestic and regional operations, building on steady and profitable growth achieved over the past four years. The new fleet will enhance flexibility across LATAM group’s hubs, enabling the group to serve additional destinations and expand travel options for customers. The firm order for 24 aircraft is valued at approximately US$2.1 billion at list prices.
As declared on the occasion of LATAM group’s FY2024 earnings release, the company has a financial policy with metrics that include leverage and liquidity. This new fleet investment fits within the current Financial Policy, and no changes to the policy are expected.
“Over the past four years, LATAM group has focused on expanding its domestic and regional network, creating the most comprehensive and seamless way of travelling within South America. LATAM group’s decision is based on the excellent economics and versatility of the Embraer E195-E2, which will allow us to continue on our path of profitable growth by enhancing that connectivity through the opening of new destinations, allowing our passengers to have even more options and bringing communities closer, boosting also economic and social development”, said Roberto Alvo, CEO of LATAM Airlines Group.
“This strategic partnership with LATAM group reflects the airline’s requirement for the most efficient and best-suited aircraft to complement its fleet and support its next chapter of growth in South America. The E195-E2 will allow LATAM affiliates to connect more destinations with the right capacity, while offering passengers superior comfort. We are extremely proud that the LATAM group has made the best choice to advance the region’s connectivity and for the future we will build together”, said Francisco Gomes Neto, President and CEO of Embraer.
Equipped with cutting-edge technology, the Embraer E195-E2 combines competitive seat costs, superior fuel efficiency, and enhanced passenger comfort thanks to its 2-2 cabin configuration. Powered by Pratt & Whitney GTF engines and featuring advanced aerodynamics with the latest fly-by-wire technology, the aircraft delivers up to 30% lower fuel consumption per seat compared to previous-generation models.
The E195-E2s will join LATAM group’s fleet of 362 aircraft, which currently includes 283 Airbus narrow-bodies, 3 Airbus wide-bodies under short-term lease, 56 Boeing wide-bodies, and 20 Boeing freighters. Since 2021, LATAM group has expanded its network from 129 to 160 passenger destinations – a 24% increase – underscoring its continued investment in strengthening operations across the region.
Notes:
- LATAM’s order for 24+50 E95-E2 is a strong signal for Embraer. It is also a significant win – should we say, another win.
- Despite losing LOT, Embraer has been on a winning streak with important customers like SAS. The recent win with Avelo (despite the chatter about financing) was another big win.
- Embraer won this deal from an airline with 78% of its fleet consisting of Airbus single-aisles.
- The E2 will be used for regional service across South America. Because of the E2’s lighter weight and 3,000-mile range, it can serve almost any city pair across the region. The aircraft should enable LATAM to open new markets, and as these grow, upgrade to larger aircraft.
- Moreover, several regional markets will benefit from the E2’s E2TS auto-takeoff capability.
Bottom Line: LATAM’s order signals growing confidence in Embraer’s E2 program and reinforces the case for right-sized regional jets in South America’s diverse network environment.
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