Brazil was one of a few countries that had to put the stamp of approval on the Boeing-Embraer partnership (Joint Venture). With Brazil’s approval, the venture still needs to pass through European Regulators to close the deal.
Brazil is the ninth market to approve the Boeing-Embraer partnership
At long last, CADE the Brazilian Regulator gave the Boeing-Embraer team clearance to get one step closer to the finish line. Although it gives an option to reconsider the case, so far it passed without restrictions.
It allows Boeing to compete in a better footing with Airbus, as the latter gets a majority stake in the A220 from Bombardier.
What new details are provided?
After receiving clearance from Brazilian Authorities; Marc Allen, Boeing President of Embraer Partnership & Group Operations said,
“This latest clearance is yet another endorsement of our partnership, which will bring greater competition to the regional jet marketplace, better value for our customers and opportunities for our employees.”
When the home regulator (Brazil) said yes to the venture, all the regions had approved the partnership, except Europe.
Why has Europe taken so long to approve the Boeing-Embraer partnership?
To be honest, let’s remember that Europe is the home region for Airbus. Although Slattery gives deference to European Regulators in the video, I, as an author, don’t need to give the same courtesy.
Europe wants to get as protective of one of the few industries they have on their own. They want to give Airbus the most advantageous position they can while being compliant with the rest of the world.
However, it is up to them whether this passes muster. With the rest of the world given a green light, it would be hard not to pass it, unless it is with no restrictions. That puts the European region in a rock and a hard place.
Turboprop Decision rides on whether the Joint-Venture is Achieved
Aerei da Transporto Regionale (known for its acronym ATR) is a Franco-Italian enterprise that is the biggest aircraft manufacturer using propeller engines.
This Joint-Venture is half-owned by Airbus (50%) and the other half by Leonardo S.P.A.
It is an aerospace and defense Italian company similar to what Embraer is in Brazil.
The decision of whether Embraer takes shape on the reluctance of the EU Regulators and the advantage by Airbus as ATR has a 4/5 advantage in the market and the rest is by the Dash which was divested to Longview Aviation by Bombardier in 2019.
If the regulators give the go-ahead then a new competitor would enter the picture in the form of Boeing-Embraer.
Reading tea leaves again? Author’s Opinion about the Boeing-Embraer Partnership (JV)
Europe is the only region that has not given approval to the joint venture. The Europeans must give one without preconditions.
I maintain my January analysis. The cynical person in me gives approval with conditions. However, with the rest of the world not giving any conditions what could drive that decision?
Protectionism towards Airbus, and against the Boeing-Embraer venture?
Let’s not forget that it isn’t the only thing at stake, but the future of the propeller market is also at stake.
The Europeans will take their time but they shouldn’t go against the venture. If they do there will be hell to pay from suppliers and support industries that help make these aircraft.
Featured Image: Embraer L650 FlightDeck. Photo: Embraer.