“Good question,” replied Embraer CEO Francisco Gomes Neto. “Our main mission is to grow profitably. Always with safety and quality.” Over a plate of antipasti at an Italian restaurant in midtown Manhattan, Neto offered a winding answer during an October interview. He threaded the chaos of 2020 — the combination of the pandemic’s collapse in sales and traffic, the abrupt end to its joint venture with Boeing and the added costs of carving out and later reintegrating its commercial unit.
In the depths of the pandemic, Embraer shrunk its workforce by 20% — 4,000 people — and reduced its gross debt from $4.4 billion down to $2.6 billion. It was a plan hashed by 60 vice presidents and directors “to prepare the company to grow profitably in the future,” said Neto.
“We are now in the harvest season” after completing development of a spate of new products in its commercial, executive jet and defense units, said Neto. “Take advantage of everything we have done in the past.” Rebuilding Embraer’s output means that the $4.5 billion in sales it tallied in 2022 across its business units could double by 2026 as it looks to increase production well beyond 250 aircraft per year. It has so far delivered 105 through the third quarter.
But what’s missing from Embraer’s strategy is a specific area of focus on future product development for its core businesses. “In ’24 and ’25 we want to focus heavily on improving further the financial performance of the company. We don’t want to reduce the engineering force, but also don’t want to increase the engineering force in this period,” said Neto. “And then maybe in 2025 we will decide which way we go for the future.”
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