Will a Middle East Carrier Order Embraer Jets?

November 14, 2017

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Embraer Order in the Middle East
Which Airline Could Order the E2 Jets?
Competition is Tough
Landing Thoughts:

We are knee deep in the Dubai Air Show. Yesterday was the halfway point, and we have seen many orders, developments and amazing displays. Although I will have a full report on the occurrences at the show (specifically on product development and orders), I wanted to share a set of rumors I read online from a reputable source.

Embraer is known as the manufacturer of their successful ERJ family of jets. Their newer version of the jets, the E2 family, has had lukewarm reception. Many carriers, such as American, are still ordering E1 family jets because they can be available quickly. In the Middle East, there are very few carriers that operate the E1 family. I only know of Royal Jordanian and Oman Air, if I missed any please comment. Given the niche that these aircraft fill, Embraer has set forth on a mission.

Embraer Order in the Middle East

Embraer is looking to have a major customer in the Middle East by the end of the year. Although the order may come as soon as during the Dubai Air Show, I suspect it will come later. The logistics of the order would need to be ironed out, and then the formalities of the announcement. Embraer touts that its jets could fill a gap that is currently not being exploited in the region. Their jets could provide lower capacity, more efficient jets for routes that are being served. This could allow airlines to launch more frequencies to smaller airports, and open up thinner routes.

Which Airline Could Order the E2 Jets?

I suspect that the jets will not be ordered by the ME3. Given the sheer scale of their operations, they can make larger jets feasible on shorter routes. I can see other airlines taking advantage of the airplane, however. Oman Air, Gulf Air, Kuwait Airways, and some of the low cost carriers in the region could benefit. I can even see FlyDubai being able to find a niche for the planes. Saudia used to fly E170s, but has since stored them. Although i do not know the reason, they may be looking to substitute them. In the longest shot, however, I could imagine Qatar Airways launching their Indian carrier with a set of orders from Boeing or Airbus, as well as from Embraer.

Competition is Tough

The market for the E2 is a bit tougher today than it was a few months ago. When Airbus purchased part of the C Series from Bombardier, Embraer took the most direct hit. Now they will need to compete with Airbus’ global scale. There is also a bit of a threat from the Chinese C-919, which has undergone testing recently. I don’t think this will be a major threat, given the C-919’s regional appeal and larger size. The MRJ, Japan’s answer to the regional jet market, is still untested, and orders are delayed. Nonetheless, the company faces a tough road ahead to get the orders.

Landing Thoughts:

I don’t know how likely will the ME3 order the E2 jets, but I can see the market for them with smaller carriers. The company will have to market itself very strongly, and take advantage on Airbus’ lagging order book. I would love to see the orders placed during the Dubai Air Show, but I wouldn’t bet on it.