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Embraer (ERJ) Signs MoU to Boost MRO Services for E2 Jets
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Embraer S.A. (ERJ - Free Report) signed a Non-Binding Memorandum of Understanding (MoU) with SIA Engineering (Philippines) Corporation (“SIAEP”), a subsidiary of SIA Engineering Company Limited. This partnership will enable SIAEP to provide maintenance, repair and overhaul (MRO) services for Embraer's E-Jets E2 family of aircraft.
Since 2017, SIAEP has been serving as Embraer’s authorized Asia-Pacific E-Jet service center. In addition to the existing E-Jet presence in APAC, this MoU provides a good starting point for ERJ in terms of discussing additional support for the expanding E-Jet E2 fleet within the region.
Growth Prospects
Embraer continues to witness strong market demand for its E-jets worldwide. E2 is the second generation of the E-jet family of commercial aircraft. The company had seven E2 deliveries in the second quarter, up more than 100% from the year-ago quarter’s level. As of Jun 30, 2023, Embraer’s E-Jets E2 had 281 orders in the backlog, along with strong sales performance in Executive Aviation.
Per a report by the International Air Transport Association, published in June 2023, the demand for air travel is expected to double by 2040, growing at an annual average rate of 3.4%.
To duly reap the benefits of such abounding growth prospects offered by the commercial aerospace, Embraer is making valuable partnerships, like the latest one, in addition to upgrading its aircraft.
Notably, in August 2023, Embraer announced the expansion of its partnership with CAE Inc. (CAE - Free Report) to promote pilot training services for its E-Jet E2 family of commercial aircraft. Embraer-CAE Training Services (“ECTS”) was created through this joint venture to provide pilot and cabin crew training for E-Jet E2 family of jets.
Considering the fact that the E-Jet services and support are available to more than 940 customers in 70 countries, we may expect ECTS to become available in other parts of the world in the coming years. This, in turn, should boost growth prospects for both Embraer and CAE.
Peer Moves
Apart from Embraer, other jet companies that may benefit from the growing commercial aerospace industry have been discussed below.
Boeing (BA - Free Report) : Boeing has been the premier manufacturer of commercial jetliners for decades. During the second quarter, the Boeing Commercial Airplanes segment observed a solid 12.4% year-over-year surge in commercial jet deliveries, buoyed by higher 787 jet deliveries. This, in turn, resulted in a 41% increase in the unit’s revenues.
In second-quarter 2023, Boeing delivered 136 commercial airplanes and received 460 net orders. With the new airplanes, which are yet to be delivered, the company should benefit from the trending air travel demand trail.
Airbus (EADSY - Free Report) : In the first half of 2023, Airbus delivered 316 commercial aircraft and targets to deliver 720 in 2023. In August 2023, Wizz Air signed a contract for an additional 75 A321 neo Family aircraft, taking its total order for the largest member of the Airbus single-aisle to 434.
Airbus boasts an order backlog of 7,967 commercial aircraft as of Jun 30, 2023. Such solid delivery and backlog count reflects the strong demand that Airbus enjoys in the commercial aerospace market.
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Embraer (ERJ) Signs MoU to Boost MRO Services for E2 Jets
Embraer S.A. (ERJ - Free Report) signed a Non-Binding Memorandum of Understanding (MoU) with SIA Engineering (Philippines) Corporation (“SIAEP”), a subsidiary of SIA Engineering Company Limited. This partnership will enable SIAEP to provide maintenance, repair and overhaul (MRO) services for Embraer's E-Jets E2 family of aircraft.
Since 2017, SIAEP has been serving as Embraer’s authorized Asia-Pacific E-Jet service center. In addition to the existing E-Jet presence in APAC, this MoU provides a good starting point for ERJ in terms of discussing additional support for the expanding E-Jet E2 fleet within the region.
Growth Prospects
Embraer continues to witness strong market demand for its E-jets worldwide. E2 is the second generation of the E-jet family of commercial aircraft. The company had seven E2 deliveries in the second quarter, up more than 100% from the year-ago quarter’s level. As of Jun 30, 2023, Embraer’s E-Jets E2 had 281 orders in the backlog, along with strong sales performance in Executive Aviation.
Per a report by the International Air Transport Association, published in June 2023, the demand for air travel is expected to double by 2040, growing at an annual average rate of 3.4%.
To duly reap the benefits of such abounding growth prospects offered by the commercial aerospace, Embraer is making valuable partnerships, like the latest one, in addition to upgrading its aircraft.
Notably, in August 2023, Embraer announced the expansion of its partnership with CAE Inc. (CAE - Free Report) to promote pilot training services for its E-Jet E2 family of commercial aircraft. Embraer-CAE Training Services (“ECTS”) was created through this joint venture to provide pilot and cabin crew training for E-Jet E2 family of jets.
Considering the fact that the E-Jet services and support are available to more than 940 customers in 70 countries, we may expect ECTS to become available in other parts of the world in the coming years. This, in turn, should boost growth prospects for both Embraer and CAE.
Peer Moves
Apart from Embraer, other jet companies that may benefit from the growing commercial aerospace industry have been discussed below.
Boeing (BA - Free Report) : Boeing has been the premier manufacturer of commercial jetliners for decades. During the second quarter, the Boeing Commercial Airplanes segment observed a solid 12.4% year-over-year surge in commercial jet deliveries, buoyed by higher 787 jet deliveries. This, in turn, resulted in a 41% increase in the unit’s revenues.
In second-quarter 2023, Boeing delivered 136 commercial airplanes and received 460 net orders. With the new airplanes, which are yet to be delivered, the company should benefit from the trending air travel demand trail.
Airbus (EADSY - Free Report) : In the first half of 2023, Airbus delivered 316 commercial aircraft and targets to deliver 720 in 2023. In August 2023, Wizz Air signed a contract for an additional 75 A321 neo Family aircraft, taking its total order for the largest member of the Airbus single-aisle to 434.
Airbus boasts an order backlog of 7,967 commercial aircraft as of Jun 30, 2023. Such solid delivery and backlog count reflects the strong demand that Airbus enjoys in the commercial aerospace market.