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Embraer cuts sales forecasts for small RJs

 - December 11, 2006, 9:15 AM

Brazil’s Embraer has once again lowered its projection for the small regional jet segment, predicting a 10-year demand for just 500 units in the 30- to 60-seat segment in its latest market outlook for the airline and business jet markets. Just two-and-a-half years ago Embraer projected a 10-year market for 1,745 airplanes in the 30- to 60-seat jet category. Last year it revised its prediction to reflect a 10-year demand for 650 airplanes for the entire industry.

Embraer’s rival Bombardier recently announced its plans to halt production of its 50-seat CRJ200 starting in January. It called it a “temporary” disruption, but has not said when or if it expects production to resume. Both companies’ backlogs have fallen to double digits in recent months.

The Embraer forecast reflects a much more upbeat outlook for the rest of the market, however, projecting a total demand for 7,950 units of 30- to 120-seat aircraft over the next 20 years. Africa and the Middle East will account for only 280 of those airplanes, roughly a 4-percent share. The U.S., Canada and the Caribbean will lead all regions with a demand for 4,230 airplanes, or 53 percent of the market, says Embraer.

Embraer estimates a demand for 9,680 business jets over the same 20-year period, including a “conservative” estimate of 2,500 very light jets in the class of its new Phenom 100.