Summary

  • Embraer’s backlog increased to $21.1 billion, with significant orders from American Airlines.
  • Deliveries surged by 67% in Q1 2024, with a total of 25 jets, including E-jets and private aircraft.
  • Embraer’s market cap is rising, making it more competitive with available production slots from 2026.

The Brazil-based aircraft manufacturer Embraer has recently enjoyed strong demand for its aircraft, driving up the company’s stock. This year, American Airlines confirmed an order for 85 Airbus A321neos, 85 Boeing 737 MAX 10s, and 90 Embraer E175s (with the option of a total of 133 Embraers). It’s not just orders: it’s also deliveries. Embraer E2 deliveries more than doubled in 2023.

Embraer sees growing backlog

Embraer has seen a recent surge in orders, and its backlog is now at a seven-year high of $21.1 billion. In addition to its backlog for regional passenger aircraft, Embraer’s private jet backlog has been growing.

Embraer E195-E2 with the Profit Hunter landing at Luqa Malta International Airport MLA shutterstock_1637645161

Photo: InsectWorld | Shutterstock

According to Embraer, that is a 13% increase over the previous quarter. A large part of the increase was a large American Airlines order for up to 133 Embraer E175 jets. On March 4, American Airlines ordered 90 E175s with operations for another 43. This is now 10% of Embraer’s backlog. The Embraer E2 backlog total is 194 units (179 E19-E2s and 15 E190-E2s).

The Brazilian carrier Azul Airlines accounts for 30%, or 51 aircraft, of the E195-E2 backlog. Porter Airlines (a Canadian carrier) is also expecting another 43 jets. Republic Airlines, Skywest, and Horizon Air also have notable orders for the E195-E2. Azorra has ordered most (12) of the E190-E2s.

Embraer delivered some 67% more aircraft in Q1 2024 compared to Q1 2023. Its deliveries consisted of 25 jets, of which 18 were from the company’s executive aviation segment and another 7 were its passenger E-jets. The seven E-jets were four E195-E2s and three E175s.

Related

Top Regional Jet: Where American Airlines Is Flying The Embraer E175

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Recovery of market cap

Embraer production slots are available from 2026. This also helps to make Embraer somewhat more competitive, as its regional aircraft can compete with smaller Boeing and Airbus aircraft. Boeing and Airbus are sold out until the end of the decade (and the fallout from Boeing’s troubled 737 MAX is impacting production). At some point, it becomes more attractive to receive aircraft in a reasonable timeframe.

An Azul Embraer E195 E2

Photo: Guilherme Amancio Moreno | Shutterstock

Embraer is the third-largest aircraft manufacturer (after Boeing and Airbus) and builds regional aircraft and business aircraft. According to CompanyiesMarketCap, Embraer’s market capitalization has increased around 70% this year, rising from around $3.5 billion to over $5 billion. This is a strong recovery from its low in 2020 when its market cap fell below $1 billion. That said, it is still considerably below the high it reached in 2007 when its value rose to almost $9 billion. Embraer shares are traded on the Sao Paulo exchange.

Embraer is also a defense contractor that supplies aircraft such as the A-29 Super Tucano and the C-390 Millennium. The first C-390 Millennium of the Hungarian Air Force recently completed its maiden flight, while Embraer is working on other defense contracts. The company’s defense and security backlog amounted to $2.4 billion in Q1 2024.

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