LABACE Convention News

Brazil Needs Bizjets, Says Embraer’s Pellegrini

 - August 30, 2016, 11:07 AM
Embraer feels that aircraft such as its Phenom 300 light jet provide just the sort of business travel tools Brazilian companies need to move efficiently around the vast country. [Photo: Ian Sheppard]

The day before this year's LABACE show opened, Marco Túlio Pellegrini, president and CEO of Embraer Executive Jets, told AIN that Embraer’s aircraft offer Brazil a powerful facilitator of economic development. His statement came on the day that the Brazilian Senate was debating the legacy of president Dilma Roussef, who will be impeached on Wednesday if a two-thirds vote is reached, as is widely expected.

Pellegrini, speaking at Embraer’s new São Paulo offices, which offer a spectacular view of the city, said he believed the country was feeling that it had reached the bottom of the current recession and that its currency felt more stable – having blipped up against the dollar.

“Brazil is a large country, not well served by air – but the bizjet can help a lot to speed up the recovery,” he said, adding that Brazil’s entrepreneurs were largely unaware of the potential time savings for their companies. Business aviation would allow them to visit several cities in a day when such a trip by airlines would take several days, if possible at all.

He gave the example of a journey starting in São Paulo, with whistle stops in Brasilia, Recife and Curitiba, then back to São Paulo. All that very possible in one business day, using a small jet, he said, with the added advantage that executives can work en route, “and prepare for their next meeting.”

Embraer’s ambition is to break a deadlock and allow Brazil to see more charter companies and FBOs emerge. A business model involving expanded use of of business jets, many of which are leased; could be a powerful catalyst to see the sector develop rapidly, with knock-on economic benefits, Pellegrini believes.

“Brazil has close to 5,000 runways – 50-60 are just in the São Paulo region.” Several regions such as Mato Grosso and Brasilia could benefit from using such airfields. In still more cities there are airports, not served by airlines, that business aircraft could use.

“Today the charter business and traffic is low, but this could be an opportunity for everyone.” He pointed to all the large corporations that could benefit from such premium transport, though as a “business tool.” As in other parts of the world, business aircraft in Brazil are saddled with connotations of being for the rich, rather than for business.

Pellegrini suggested that the Phenom 300, which has been the world’s best-selling business jet for the past three years, could offer a great starting point, and pointed out that it was available in a single-pilot, 10-passenger configuration.

“There are a lot of charter companies, but they usually manage someone else’s airplane. There is no consistency of service or aircraft. Many aircraft are old and of various brands.” He added that there were “various initiatives being proposed, but none in a structured way.”

He reiterated that utilization was the key and that Embraer’s clean-sheet design aircraft–the Phenom 100/300 and the Legacy 450/500–were particularly suited to domestic and Latin American operations, respectively, “But we are talking about broader use [than only senior executives], including managers and senior vice presidents. This is missing today in executive aviation.”

During LABACE Pellegrini is planning to “take the temperature” of the sector, “to see if confidence is coming. On Tuesday, Wednesday and Thursday we will see if customers are willing to invest.” He suggested that 2016 unit sales would likely not be far off the 2015 levels, but lamented that margins weren’t as good. “It’s not just the numbers of aircraft that is important.”

Meanwhile, the company continues its quest to become “the most desired brand in business aviation,” and although Pellegrini alluded to a future wide-cabin, long-range clean-sheet design, he suggested that some are drawn to such long-range jets (such as those from Gulfstream and Bombardier) when all they need is something like a Legacy 500. He predicted that customers would start to get smarter in this respect, and less swayed by image.

Pellegrini concluded by underscoring Embraer’s commitment to customer service as the best tool for cementing sales and keeping customers’ loyalty – as shown by his company topping the ratings in AIN’s most recent satisfaction survey.

He also added that other new avenues for sales could emerge–from Uber-like companies that could also help address the looming pilot shortage. For example, since the U.S. rule requiring 1,500-hour rule for regional airlines’ first officers, aspiring pilots could fly in business aviation–sitting alongside very experienced business jet captains–while accumulating hours towards an airline job.