Brazilian Embraer believes the current reform and consolidation in the Chinese airline industry will open new opportunities for the regional aviation market, despite the current economic downturn.
The giant Brazilian aircraft manufacturer Embraer chose Macau as the location for its launching pad into the mainland last month.
Speaking in Macau, Embraer vice-president Guan Dongyuan predicted that the mainland would need an additional 883 aircraft over the next 20 years to serve regional destinations.
Embraer is the third largest aircraft manufacturer in the world, whose military and civilian aircraft are sold in more than 40 countries. Mr Guan said the air transport market in China was the second largest in the world after the United States.
“China has an undeveloped market for regional and corporate jets given that they account for just a fraction of the total number of aircraft in the country,” Mr Guan said. “We are going to post US $400million in sales in the China market this year, compared with US $150million last year.”
There are more than 1200 aircraft deployed on the mainland. Embraer has sold 38 aircraft to six Chinese airlines and has more than 126 orders.
In a presentation made at Macau International Airport last month Mr Guan said despite the fact that Asia was responsible for 29 per cent of the world’s gross domestic product, it was home to just 3 per cent of the world’s business jet fleet.
As part of its push into the mainland, Mr Guan announced the airline would be participating in the seventh China
New flight plans on radar
International Aviation and Aerospace Exhibition (Airshow China) from November 4 to 9 in Zhuhai. He also presented a world map to potential clients detailing destinations that could be reached from Macau on Embraer jets, including Dubai, Seychelles and Norilsk.
“Participating in events like this one gives the company an exposure to the public and demonstrates its commitment to customers in the region,” Mr Guan said. “We firmly believe that the steady growth of China’s gross domestic product will generate sizeable demand for both commercial and executive aviation, for which Embraer’s products have a longstanding history of commitment and are capable of delivering excellence.”
The airshow is one of the most important events of the aviation industry in Asia with operators, manufacturers, regulatory bodies and government authorities set to attend.
In 2004 Embraer’s executive jet Legacy 600 started flying from Macau for Landmark Macau. Sichuan Airlines, Grand China Express, China Eastern Airlines and China Southern Airlines all use Embraer aircrafts.
Embraer’s ERJ 145 aircraft has a capacity of 30 to 50 passengers and E-Jets seat up to 120 passengers. The company has also sold executive jets Phenom 30, Legacy 450-500 and 600 and Lineage models in China.
Embraer produces military and civilian aircraft, with the commercial sector accounting for the majority of its business. It specialises in middle-range aircraft for the regional market. A key member of its stable is the ERJ-145/135 series, which is available as a 50-seat or 37-seat aircraft. These twin-jet engine craft have the conveniences such as toilets and galley the equal of a big jet, but much lower operational costs.
They have a cruising speed of 451 knots and a range of 18,000 to 24,000 kilometres.
Embraer’s headquarters is located in Brazil and has operations in the United States, Europe and Asia. It opened its first office in Beijing eight years ago and added a 750-square-metre distribution warehouse that stocks more than 6000 part numbers.
“As one of the leading aircraft manufacturers in the world, Embraer is optimistic about the future of the Chinese aviation market,” Mr Guan said. “We believe the current reform and consolidation in the Chinese airline industry will further push forward the rationalisation of the airline networks, opening new opportunities for the regional aviation market.”
Embraer’s competitors Boeing and Airbus have estimated the mainland will need more than 3000 large aircraft over the next 20 years. The Middle East is also predicted to be a hot spot for the business aviation sector with annual growth of up to 20 per cent expected until 2012. At this rate the market would be worth more than US $1 billion.
Despite the optimistic outlook, it will not be all smooth sailing for Embraer as it endeavours to increase its Asian footprint. Russia’s United Aircraft Corporation (UAC) has entered the market with its new Superjet-100 regional jet, with media reports from May this year indicating that UAC, which is being partnered by Boeing, had 73 orders for the Superjet.
UAC representatives were reported as saying they hoped to sell 1200 of the Superjets over the next 20 years, with the price estimated to be about US $25million a plane.