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For at least the last five years, Embraer has been talking to deep-pocketed sovereign sources of capital to aid in its pursuit of a major next generation aircraft project — an undertaking that will require a multi-billion-dollar investment, particularly if the Brazilian plane maker opts to compete with Boeing and Airbus.
Working with the industries of major nations is as much about market access as it is about tapping into patient capital. The strategy acknowledges that the short time horizons of many commercial investors are fundamentally incompatible with aerospace, and that government investment may be required to get an ambitious commercial airliner program over the finish line. The list of possible partners so far has included the Public Investment Fund of Saudi Arabia, India, Turkey and South Korea — each with long-term strategic aerospace ambitions.
Related: Embraer enters ‘harvest season’ after decades of unceasing development
Embraer is also talking with the Japanese government and its heavy industry conglomerates, two people briefed on the discussions tell The Air Current. While it is possible these talks may never produce a collaboration, this is a potential major shift in Japan’s government policy that has long seen the country aligned with Boeing and the United States on commercial aerospace projects.
“Embraer has consistently shared with the market its intention to find external partners — both industrial and financial — to help develop Embraer’s business and product portfolio across its business units,” a company spokesperson told TAC in a statement.
Related: Embraer CEO: ‘Geopolitical alignment’ makes China tilt ‘natural’
Embraer CEO Francisco Gomes Neto told TAC in October that it was eyeing a 2025 or 2026 decision for its next major product development. Precisely what that product will be, who it will be for, who it will be built with, and when it might be ready remains a topic for debate both internally and externally to Embraer, which may not need advanced propulsion to justify its undertaking — counter to industry conventional wisdom.
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