Embraer forecasts strong demand for smaller jets

Embraer has forecast demand for 10,550 new aircraft with up to 150 seats worldwide over the next two decades, worth about $600bn.

The company said the fleet of aircraft of that size in service is expected to increase to 16,000 units over the period, compared to 9,000 currently in operation. Market growth will be responsible for 65 percent of that demand, while 35 percent will be to replace old aircraft.

Of predicted 10,550 new aircraft in the up to 150-seat segment, Embraer said Asia Pacific would account for 28 percent of demand, North America 27 percent, Europe 21 percent, Latin America 11 percent, Commonwealth of Independent States 6 percent, Africa 4 percent and Middle East 3 percent.

Embraer’s Market Outlook added that over the next 20 years, 20,260 narrow-body aircraft in the 150–210 seat segment will be delivered worldwide. Jets at the middle range of the capacity spectrum will continue to dominate future demand, but an increasing focus on the largest aircraft is expected.

The report also said projected deliveries for turboprops are 2,320 between now and 2037.

However, Embraer cautioned that the economic performance of the airline industry will mostly depend on how far costs will rise and to what extent the industry can sustain a healthy revenue environment.

Bit it claimed that aircraft in the up to 150-seat segment are the best placed to combine cost efficiency with stronger yields.

“Even though every facet of the industry has excelled over the past years, we are now warming up for the next period of higher costs, with pressures on yields likely to continue unabated,” said John Slattery, president and chief executive of Embraer Commercial Aviation.

“Profits are eroding and gains wiped out with rising costs.”

Up to 150-seat segment – deliveries by region