- The WSJ reported that Embraer was looking to build a new plane to compete with Boeing and Airbus.
- The planemaker denied this, but added that it “certainly has the capability.”
- Boeing’s recent problems suggest that its smaller rivals may have an opportunity to move into the duopoly.
Brazilian aircraft manufacturer Embraer has denied reports that it would like to take advantage of Boeing’s misfortune by working on a new plane.
On Wednesday, the Wall Street Journal reported that Embraer was exploring options for a new narrow-body plane to compete with the Airbus A320neo and Boeing 737 Max.
Citing people familiar with the matter, the Journal said Embraer had conducted internal assessments that found it had the capacity to develop such a plane.
The company is known for making smaller jets like the four-abreast Embraer E175, which is typically used by regional carriers like Republic Airways, operated on behalf of legacy airlines.
Embraer’s ambitions for a larger, next-generation jet were solidified after Boeing’s recent crisis following the Alaska Airlines blowup, the Journal reported.
But an Embraer spokesperson told Reuters that Embraer was not considering a new round of spending.
“Embraer certainly has the capability to develop a new narrow-body aircraft. However, we have a young and very successful product portfolio developed over the last few years, and we are really focused on selling these products and developing ‘Embraer and its solidity,’ they added.
The Brazilian company has a market capitalization of around $5 billion, while Boeing and Airbus exceed $100 billion.
But as Boeing loses the trust of some customers and suffers delivery delays amid unrest that led to the resignation of its CEO, smaller players may have more room to disrupt the duopoly. Airbus’ A320neo family is so popular that it has an order book of more than 10,000 aircraft.
China could also provide an alternative to narrow-body aircraft from the two major aircraft manufacturers. The Comac C919 entered service last year, and while it has only received orders from Asian airlines so far, Boeing’s problems could prompt carriers to take a closer look at it.
businessinsider
