FARNBOROUGH: KC-390 grows in importance for Embraer Defense

Farnborough
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The KC-390 tactical military transport/tanker programme will represent 39% of Embraer Defense and Security's total revenue in 2012, up from 19% last year, and is a big focus of the company's presence at Farnborough.

"We are in a very important phase right now, which is the joint definition phase, and as the project is fully funded by the government, we are getting more revenues and cash to take care of this phase, which is more important in volume than was the first phase of the project last year," says Luiz Carlos Aguiar, president of Embraer Defense and Security.

"The KC-390 makes a big difference - it's the main driver of our growth from 2011-2012."

Embraer (chalet A17-18) says the KC-390 programme remains on schedule, and there are now 800 people working on it. The joint definition phase should be completed by the first quarter of 2013.

"By March or April [2013], we will have final terms and conditions for this aircraft to go to the market and sell it aggressively," he says.

Embraer forecasts a market for 700 KC-390s up to 2025, worth around $50 billion.

"We have identified more than 2,000 old aircraft in this segment," says Carlos. "Most of these are [Lockheed] C-130s and they need to be replaced in the next 10 years. There is no doubt about it."

Embraer is discounting countries such as China and India - which are developing their own military transport aircraft - as potential buyers of the KC-390.

"We decided to delete [from the forecast] those countries that have a manufacturer in the same segment," says Carlos. "We are not considering the USA, Russia or India, or those countries with export control issues.

"Our aircraft is going to be in the market in 2016. I think we are going to be the first [ahead of the Chinese/Russian MTA], which will be a benefit."

The KC-390 is due to have its first flight in 2014. Letters of intent covering a total of 60 aircraft have been secured from Brazil (28), Colombia (12), Argentina (6), Chile (6), Portugal (6) and the Czech Republic (2).

France has expressed interest in taking 10 aircraft: "France is one of the countries included in our forecast. We don't see any obstacle to trying to sell to France. It's our intention to promote the KC-390 in France."