BOMBARDIER e EMBRAER descontinuarão CRJ e ERJ até 50 pax

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Reuters 11 Novembro 2005
Embraer to kill 50-seater regional jet.
Airline economics, fuel costs, lower demand blamed
Sean Silcoff
Financial Post
ORLANDO, Fla. - Bombardier Inc.'s Brazilian rival Embraer will stop producing 50-seat regional jets by the middle of next year, a few months after the Montreal company's final delivery.
"This is a reality from the market," Embraer chief executive Mauricio Botelho said in an interview at a business aviation convention at which the company, Empresa Brasileira de Aeronautica SA, launched two small executive jets.
"There is not a demand for 50-seaters, and I see that orders will not come up again for a long period." Even then, he said, "Orders will come, but at a lower pace and smaller quantities" than in the past."
Regional jets soared in popularity after Bombardier put its first model into service in 1992. Embraer's plane came to market five years later. Both planes were modified versions of different models the companies had manufactured for years.
Regional airlines in the United States began to order massive quantities of the small jets to serve short-haul routes previously served by slower and noisier turbopropeller-powered planes. The new jets had greater range, allowing airlines to fly more point-to-point routes between markets that had previously required a stop at a main hub.
When air traffic plummeted following the Sept. 11, 2001, terrorist attacks in the United States, 50-seaters were used in great numbers to fill in for larger planes on some routes, and Bombardier executives hailed the little planes as saviours of the airline industry.
But other industry dynamics were shifting in ways that would quickly make the jets less attractive. Lower traffic, increasing competition from discount carriers and higher fuel costs began to push some of the largest U.S. airlines into bankruptcy. Airline bosses said the key to survival was to restructure and order more regional jets.
At the same time, however, the airlines persuaded unionized pilots in their mainline fleet to make concessions that freed them to add larger regional jets to their networks. Pilots had originally bargained to have stiff limits on the number and size of regional jets, as they were flown by non-unionized pilots in the outsourced regional feeder network.
Freed of the constraint of ordering jets with fewer than 50 seats, airlines looked more to planes with 70 or more seats, which both Bombardier and Embraer developed in anticipation of an eventual move upward. However, that move happened much sooner than either anticipated. Demand shifted to 70-seaters, exacerbated by fare pressure from discounters and higher fuel prices -- all of which made 50-seaters less economical to operate. After delivering 152 of its 50-seaters in the year ended Jan. 31, 2004, Bombardier ratcheted down production several times and said two weeks ago it would suspend production in January, after producing just over 1,000 of the planes.
Embraer has delivered 831 of its 37- to 50-seat regional jets as of June 30, with a backlog of 67 jets.
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Cláudio Severino da Silva
jambock@brturbo.com.br