Why these Brazilian airplanes loved by passengers are conquering short-haul flying

(CNN) — One man’s loss is another man’s gain, goes the saying – and as Boeing seems caught in a spiral of bad news, one aircraft manufacturer is quietly powering ahead.

Brazilian manufacturer Embraer, which specializes in smaller narrow-body passenger jets, has been clocking up major announcements, and will soon comprise the entire regional fleet of American Airlines.

And now, rumor has it that the company might be setting its sights even higher. A Wall Street Journal report last week suggested that Embraer – currently the world’s third largest aircraft manufacturer – was planning a new narrow-body jet that could “compete head-on” with the Airbus A320neo and Boeing 737 Max, which have cornered the global market.

Embraer has denied the reports. Yet the company’s star is certainly on the rise.

On May 2, Embraer delivered its 1,800th E-Jet aircraft: an E190-E2, to Royal Jordanian Airlines. Five days later, Singapore-based Scoot Airlines took delivery of its first Embraer: another E190-E2, the quietest and most fuel-efficient single-aisle jet on the market.

Even in the US, where Boeing has traditionally ruled the roost, Embraer has been making waves.

On March 26, United announced a refurb of its Embraer E175 fleet to add larger overhead bins on its Skywest-operated planes. The move will increase storage space by 80%. Skywest is the world’s largest operator of Embraer’s E175 aircraft.

Then there’s American Airlines, which announced the purchase of 90 E175 aircraft in March, making AA’s entire regional fleet Embraer by the end of the decade.

The love-in continued in April, when CEO Robert Isom praised the Brazilian company during a quarterly call. “The rest of the industry… can learn a lot from them,” he said, while also delivering a public rebuke to Boeing to, “Get your act together.”

It’s almost as if as Boeing’s star continues to fall, Embraer’s continues to rise. But can it go even bigger – and turn the “Big Two” of the skies into a “Big Three?”

To do so would require coming up with a new, larger aircraft to rival the 737MAX and the A320. At the moment, Embraer aircraft carry a maximum of 146 passengers, compared to the MAX’s minimum 172. It’d also mean scaling up – Embraer delivered 181 jets in 2023, of which 64 were commercial aircraft. Before the pandemic, it was delivering around 90 commercial aircraft per year.

Yet as Boeing struggles to regain public trust, experts say there’s room for someone else to grab a place in the market.

“The door is open a little for a [Boeing] 737 replacement,” says Robert van der Linden, curator of air transportation at the National Air and Space Museum. Although he notes that it could close again “quickly,” and that debuting a new aircraft is a colossal task for manufacturers, he believes that Embraer might uniquely be capable of making headway in the aviation market – it already has the contacts and reputation.

Rodrigo Silva e Souza, Embraer’s VP of marketing who’s responsible for strategic planning, doesn’t deny that he’s looking at potential options, but says, “That’s my job.”

“Designing, producing and delivering high-quality, highly reliable products is in our DNA, and I think that’s bringing some contrasts with what we’re seeing with other players,” he says, carefully.

But he tells CNN that aircraft take at least a decade to design and build, so while the current gap looks promising, they won’t be jumping in feet-first.

“Designing an aircraft takes 10 years, and in 10 years from now the situation is completely different.

“If someone had designed this before, they could be jumping in now, but you don’t decide to make a new aircraft and have it ready next year,” he says.

So could Embraer muscle its way to the top? It’s made it against the odds so far.

A storied background

For an aircraft manufacturer with such a toehold in the US market, Embraer’s origins might come as a surprise.

Based in São José dos Campos, in the state of São Paulo, the company was founded in 1969 by the Brazilian government – its name is a portmanteau of Empresa Brasileira de Aeronáutica (Aeronautics Corporation of Brazil) – on the back of the development of the Bandeirante, a twin-turboprop aircraft.

Initially used for the Brazilian military, the Bandeirante entered commercial service in 1972. With 15-21 seats, it was aimed at “commuter companies,” says Alvaro Romero, a Chilean aviation historian.

The company was privatized in 1994, and went public on the stock market in 2000. By that time, says van der Linden, it had already cracked the US.

“They found a very comfortable niche market for regional jets,” he says.

“It was very wise not to compete directly with Boeing and Airbus. Try and break into an oligopoly and chances are you’re going to get squashed.

“Regional jets carry anything from 35 to almost 150 passengers and Embraer grabbed hold of that market.”

In the regional market, Embraer’s primary competitor was Canada’s Bombardier, which sold its commercial manufacturing arm to Airbus in 2020.

In fact, Embraer nearly made a similar deal with Boeing in 2019, when the US giant signed up to take an 80% stake in the Brazilian company’s commercial division – before reneging on the deal in 2020. You could call it Embraer’s lucky escape.

Now, says Silva e Souza, Embraer’s main rival is Airbus itself.

Ahead of the competition

So how has Embraer succeeded where others have failed? For van der Linden, Brazil was far-sighted. “As early as the 1940s, the Brazilian government was interested in establishing aviation and aerospace manufacturing,” he says. Government backing meant that Embraer had money to produce quality planes from the outset. “It developed a very well-deserved reputation,” he says.

For aero historian Mario Overall, a member of the Latin American Aviation Historical Society, Embraer is an “exceptional” company. He puts that global success down to several factors, from its diverse portfolio (Embraer still makes military airplanes and private jets) to its designs, export strategy and outsourcing supply, keeping costs down. “Its versatility has enabled Embraer to cater to a wide range of customers,” he says. Yet he calls taking on Boeing a “daunting” process and doesn’t believe it’ll develop a larger narrowbody.

Legions of fans

With major US carriers operating small planes on regional routes, Embraer’s focus on sub-200 passenger planes – its largest, the E195, has a maximum capacity of 146 seats – is a perfect fit for the US market. They’re also used on less-trafficked routes in Latin America and Europe, as well as at difficult airports. At London City, which requires a steep 5.5 degree approach for the short runway, 85% of the aircraft are Embraers.

And while, by the numbers, AA and United are its top clients, Embraer’s biggest airline fan is perhaps LOT Polish Airlines, where 43 of its 75-strong fleet are Embraers (this week, it announced another three).

“These aircraft have been instrumental in our strategy to expand our network, allowing us to confidently launch new routes, even to destinations with initially lower demand. The Embraer fleet’s reliability, efficiency, and passenger appeal make them indispensable,” says LOT spokesperson Krzysztof Moczulski.

It’s not just airlines; plenty of frequent flyers have a crush, too.

“In Europe, it’s the best way to fly economy,” says Koen Berghuis of the 82-seater ERJ-175, which he flies on regularly with LOT.

“You have so much legroom, shoulder room, and some airlines have really comfortable seating. You don’t feel like you’re in a sardine can, which I feel on the Boeing 737 MAX. But the 2-2 configuration is the main benefit,” says Berghuis, editor-in-chief of travel blog Paliparan.

That’s right – the dreaded middle seat simply doesn’t exist. In first class on American and United, Embraer goes one better – it’s a 1-2 configuration. The smaller jets even have 1-2 in economy, too.

Travel vlogger Paul Lucas actively seeks to fly Embraer.

“It’s really pleasant to fly on – it has really big windows that mean loads of cabin light,” he says (van der Linden compares the windows of a bijou Embraer to those on a Boeing 787 Dreamliner).

“They feel like mainline jets inside, but have the operational benefits of a regional jet,” Lucas says of Embraer’s E-jet range. “They probably should get more of a profile.”

For him, a key reason why Embraer doesn’t get the same hype as the Big Two is that it’s Brazilian.

“In the US, Boeing is a flagship company – Americans were proud of it until recently. And Airbus is pan-European,” he says.

“Then there’s Embraer.”

Harvesting while Boeing spirals?

As Boeing spirals, is there a chance for Embraer to break through?

Silva e Souza says that the company’s current focus is the Energia project, which aims to develop 30-seater hybrid-electric aircraft by 2030, slashing the aircraft carbon emissions by 30% (90% if using SAF). A hydrogen-fuel-cell version is planned for 2035, with a 50-seater scheduled for 2040.

He also predicts an untapped market for small, sustainable planes to replace long drives.

And while he insists that the company is concentrating on “harvesting” following “10-15 years of very strong development” – he’s not denying that they’re eyeing all options.

At the Dubai Airshow in November, he hinted that the company was scanning markets such as the Middle East, where it says that only 16% of flights are full – meaning smaller aircraft could make certain routes more profitable. Meanwhile the company’s 2023 Market Outlook report suggests that “the future lies in the middle” – which Silva e Souza defines as 100-150 seats.

Space in the middle?

Could that “middle” get a little bigger, though? The troubled Boeing MAX starts at 172 seats – not far off Embraer’s E2-195, which seats 146.

The only other potential competitor is Comac’s C919, currently only certified to operate in China. Silva e Souza believes that Chinese-made aircraft will make it into the global market, but “it’ll take a long time.”

He doesn’t deny that Embraer is monitoring the market, however. “We speak to investors. We keep looking: smaller, bigger, commercial, defense – for each we talk to partners who will help build the business case. But we’ve done nothing specifically on the [MAX rival].

“We’re confident in our capabilities. But it’s very different taking decisions on the current situation for a product that will come 10 years from now.”

If they did take the plunge, they have an army of fans waiting to take flight.

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