Embraer Says China Will Make Up 60% of Asian Sales

Empresa Brasileira de Aeronautica SA, the world's fourth-largest aircraft maker, expects 60 percent of Asia Pacific sales over the next two decades to come from China, the world's fastest-growing major economy.
The company, which has a venture in China to assemble 50- seat regional aircraft, expects to sell more than 600 planes in the country over the next 20 years, said Frederico Fleury Curado, executive vice president for commercial aircraft sales, in an interview in Singapore today.
Curado, 45, credited for the planemaker's expansion in Asia, wants to tap a region where economic growth is spurring demand for air travel and opening up more routes to cities that need smaller aircraft. Embraer, as the company is known, has been investing in Asia to diversify its revenue sources, which have been concentrated in North America and Europe.
An aeronautical engineer who has been Embraer's executive vice president for almost a decade, Curado will take the helm as chief executive officer of the Sao Jose dos Campos, Brazil-based company this month.
Embraer has two-thirds of the Asia Pacific market share for 30 to 120-seat planes and a firm order backlog for 130 aircraft in the region. The company wants to keep a share of between 60 percent and 70 percent, Curado said.
Economies in Asia, excluding Japan, are forecast to expand 7.6 percent in 2007 and grow 7.7 percent next year, the Manila- based Asian Development Bank said in March. Asia as a whole will probably need 1,015 jets over the next two decades, half of which will be in the 100-seat category, according to Curado.
The company's customers include Paramount Airways Pvt., Hong Kong Express Airways Ltd., Mandarin Airlines, a unit of Taiwan's largest carrier, China's HNA Group, and Virgin Blue Holdings Ltd., Australia's second-biggest airline, which this week ordered six more Embraer aircraft.
Embraer is also challenging rival Bombardier Inc.'s hold on Japan, recently winning a 10-plane order from Japan Airlines Corp., Asia's largest carrier by sales. The planemaker is looking at new markets including Vietnam, South Korea, Indonesia and the Philippines, Curado said.
04/04/07 Chan Sue Ling and Leslie Tan/Bloomberg

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Categories: Foreign Apr 2007, Paramount Airways feb 2007