Meanwhile,
How embraer escaped unscathed wave:
Embraer avoided the worst Wednesday when US President Donald Trump excluded the planes of new reinforced customs duties imposed on many Brazilian products. Consequently, thus sparing the aeronautical manufacturer of a potentially as serious blow for his income as the pandemic.
Embraer. Meanwhile, its American partners had argued that customs duties of 50% threatened by Trump from the beginning of July would have resulted in disturbances in deliveries and local businesses, stressing that the Brazilian group planes are essential to regional flights to the United States.
American airlines have discreetly urged the Trump administration to exempt Brazilian aeronautical exports from these increased rights. Moreover, four sector officials told Reuters. For example, Regional carriers sent, Piedmont Airlines and Republic Airways also wrote to the Commerce Department to share their concerns.
At the same time. However, the CEO of Embraer, Francisco Gomes Neto, hastened how embraer escaped unscathed wave to meet several senior officials of the Trump administration, including the Secretary of Commerce Howard Lutnick and the Secretary of the Treasury Scott Bessent, he told the newspaper Valor EconôMico.
The arguments put forward was simple: Embraer employs thousands of people in the United States. Moreover, and airlines on the world’s leading air market have no real alternative to its regional jet E175.
The E175 is currently the only plane respecting the limitation clause present in collective conventions. Nevertheless, which prohibits the use on the regional lines of devices of more than 86,000 pounds and more than 76 places.
Embraer has around 200 E175 deliveries pending to American companies, including American Airlines Group, Skywest, Alaska Air Group and Republic. American customers also represent 70% of group jets sales.
Skywest warned last week. during a call with analysts, that she was not willing to pay a 50% tax on new aircraft how embraer escaped unscathed wave deliveries and intended to work with Embraer and other partners to repel them until the situation is resolved.
Alaska Air also said that she could consider postponing her deliveries.
After the relief on Wednesday. analysts qualified to embrace a principal beneficiary of the exemptions decided by Trump, an announcement which made the title on the São Paulo stock market over 20% compared to its lowest of the day.
“In view of this news. we plan that the title Embraer will reach new historical heights,” said JPMorgan in a note to its customers.
Links with the United States
Gommes Neto had declared earlier this month than if customs duties were applied. their impact on the company would be comparable to that of the COVVI-19 crisis, during which Embraer’s revenues had dropped by 30% and its 20% workforce.
The fate of the aeronautical manufacturer was the main concern of the Brazilian government in how embraer escaped unscathed wave the face of Trump’s threats. A source close to the file told Reuters. before the announcement of this week, that Brazilian officials had asked Washington to exempt the planes to embrace the price of 50%.
Embraer tried to convince the Trump administration that an exemption would also be beneficial for the United States. The company recalled that it employs around 3. 000 people and has final assembly lines for business jets in the country, its first market.
A large part of the parts used by Embraer come from the United States, including the General Electric engines. The group estimated earlier this month that between this year and 2030, it could buy for $ 21 billion in American products.
In a statement published on Wednesday. Embraer was delighted with Trump’s decision, believing that it confirms the positive impact and the strategic importance of its activities for Brazilian and American economies.
However, how embraer escaped unscathed wave the company remains subject to the general customs law of 10% imposed on Brazilian products in April. Embraer indicated that this tax remained harmful but bearable. and is committed to continuing to plead for a return to a zero rights policy.
Skywest noted that customs duties actually applied to the E175 would be between a third. half of this 10%, due to the large share of American components in the device.
American Airlines, a major client of Embraer, was optimistic last week as for a favorable outcome. Its financial director, Devon May, told Reuters that a 50% tax made no sense.
“I think that the administration includes the importance of embraging for North American carriers. for our economy, so we hope to reach a better solution,” he said.
“We have made sure that the administration. Embraer know our interest,” added CEO Robert Isom during a call with analysts.
Paraguassu in how embraer escaped unscathed wave Brazilia, Tim Hepher in Paris and Rosalba O’Brien)
How embraer escaped unscathed wave
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