Brazilian plane manufacturer Embraer has been thrust into an uncertain future with no immediate plan B, while not ruling out seeking a bailout after Boeing jettisoned a $4.2 billion commercial aerospace tie-up amid the coronavirus crisis.
The corporate’s shell-shocked chief, within the job for a year with little aerospace experience, sought to rally staff after the board held late-night talks to review the failure of plans for surviving the mounting aerospace competition.
However, Embraer now faces a historic crisis with its isolation reinforced by the breakup – two years after Europe’s Airbus absorbed Embraer’s main competitor, the Canadian-designed A220.
Embraer’s rapid aim is to reassure traders. It committed cost savings and mentioned it had solid liquidity.
It also tore up arguments previously used to steer unions and regulators to back the offer, saying it may survive without Boeing rather than stating the deal would be its salvation.
First, it would pay $1.6 billion in dividends from the sale. Second, it would obtain enough money to wipe debts clear and rejuvenate defense and government-jet units. As a revamped firm, Embraer would get a fresh start.
Executives additionally hoped Boeing’s marketing could be a silver bullet for the commercial unit, to be 80%-controlled by Boeing.