Embraer launches longer-range private jets in recovery acceleration

ORLANDO, Florida (Reuters) – Embraer SA (EMBR3.SA) adds two variants of long-range business jets to its mid-size Legacy range, with refurbished cabs and turbulence-reducing technology to create smoother flights, the Brazilian automaker announced on Sunday.

The launch of the two Praetor models – named after the leaders of the Ancienne Romaine – coincides with the flagship show of the business jet sector in Orlando from October 16 to 18. Embraer is pursuing a broader strategy to revitalize its business jet division.

When the Praetor models hit the market in 2019, they will join an extremely competitive space including the Bombardier Challenger 350 (BBDb.TO) and the Gulfstream G280, as well as the Textron (TXT.N) Cessna Citation Longitude to come.

Embraer's corporate jet surge is important because the company will no longer be able to count on its best-performing commercial division if it merges the company with Boeing Co. (PROHIBIT) advance.

Embraer and Boeing announced the $ 4.75 billion commercial aircraft alliance in July. If the Brazilian government agrees with Boeing, Embraer will end up with two remaining divisions, both in the red: jet planes and defense.

Paulo Cesar de Souza and Silva, general manager of Embraer, said Sunday that the agreement with Boeing would also offer advantages in terms of purchasing materials for the business jet division. Embraer, but that it was too early to say how much he would save.

"It's under discussion," he said. "I think the partnership with Boeing will contribute to all of Embraer's activities."

The business jet division has a market share of about 22%, he added.

The launch of Praetor is the responsibility of Michael Amalfitano, who took over the Embraer jet business in 2017 with the aim of providing new features that generate higher margins.

"The customer appreciates this value and, therefore, this value allows us to maintain prices," Amalfitano said at the launch.

Amalfitano said that Embraer had already secured firm orders for Praetor aircraft, although he refused to give figures.

The super-sized Praetor 600 is capable of carrying four high-speed passengers between London and New York, or eight passengers on the road at a slower speed.

For years, Embraer has increased its market share by offering significant discounts on its corporate aircraft.

But Amalfitano told investors that he would avoid discounts in the hope of boosting his margins to a figure below 5% by the end of the year.

"They are in transition right now," said Rolland Vincent, an American aviation analyst, about Embraer 's business jet.