Just a few hours until analysts came close to unanimity: Embraer () is imposed by US President Donald Trump. Perhaps he just missed matching US airlines.
Only on the morning of Thursday (10) as, while the market noted the first repercussions of the ad. In fact, the weight of the United States in Embraer sales is not low: about 60% of the manufacturer’s sales.
The fears take place around two scenarios: an increase in the costs reflected in the balance and the decrease in demand for the company’s commercial aircraft.
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Embraer concludes a relevant part of its executive jets in Florida in the United States. Up to about 60% of the Praetors line leads Brazilian components, while in Phenoms it reaches 40%. According to XP, it is possible that the part of the aircraft sent to the US would be taxed, which would impact costs of up to $ 95 million for every 10 additional percentage tariffs on profit forecast before interest and taxes (EBIT) in 2026. This is the cost risk. It would not be possible for Embraer to pass the cost of requests made. New requests, however, could be adjusted based on the 50%fare.
In the case of commercial jets, the customer is responsible for paying the fare. Hence the fear of demand: With more expensive aircraft, aerial aircraft can reduce the number of new contracts signed with the Brazilian manufacturer.
The most recent commercial jet order portfolio notes 336 firm orders, of which 181 come from US operators – it is a percentage very close to 60% sales to that market.
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It may seem that Embraer depends on the American market, but not quite. It turns out that so many airlines from the United States buy from Embraer because they simply have no one to turn to.
The size of the aircraft for some types of flights is restricted by a rule called “scope clause” (scope clause), an agreement signed between operators and pilot unions. It exists to limit large airlines to take advantage of their controlled regional flights to hiring less experienced, cheaper and not represented by the subsidiary of the subsidiaries.
One of the rules is as follows: Some regional flights can only be made on aircraft up to 39 tons. There are few models with this weight and enough seats to make the operation viable. Embraer’s E1 line E1 is the one that satisfies these characteristics.
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While seeing reasons to worry about a reduction in E1 demand, the head of mining and steel, paper and pulp and capital goods at XP Investimentos, Lucas Laghi, believes that Trump’s tariff has more negotiating strength and should not be maintained. “It’s almost a monopoly for Embraer on this specific regional route,” he says.
Since none of its competitors can absorb demand for Embraer E1, it would be necessary to change the route profile in the United States. To stimulate the purchase of an American manufacturer like Boeing, the closest option to E1 would be A220, 135 seats, against 88 seats in EMBRAER’s best-selling e-175 option.
Alone, American Airlines registered 90 firm orders of E-175; Republic Airlines has requested 40; Skywest another 16 and Horizon Air/Alaska 5.
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What’s more, it is not only due to the absence of E1-like models, as explained by RB Investimentos’s chief strategist, Gustavo Cruz: “Boeing has over 5,600 ordered aircraft not yet delivered, while Airbus accumulates about 8,600. There is no room to absorb Embraer demand without generating bottlenecks”.
For him, and to the American economy itself. “I do not see a scenario where Embraer is indeed impaired, because it would mean compromising the operation of dozens of US companies and endangering a relevant part of the United States air chain,” he says.
Throughout this Thursday, Embraer shares reacted and closed the day with a drop of 3.7%. In a statement, the company said that “it is working with the competent authorities to restore the zero tax rate of import taxes to the aeronautical sector,” added the aircraft manufacturer. “
