Embraer predicts its deliveries will rise in 2004 and 2005 as the economy strengthens in its largest market, North America, but analysts believe rival Bombardier may see regional jets selling less well than business jets.
Embraer 170 deliveries will begin next year, following the recent slip in certification. The company expects to deliver 56 170-family aircraft in 2004 and 63 in 2005 (Flight International, 18-24 November). Overall, Embraer will deliver 160 aircraft next year and 170 in 2005, up from 102 this year - the increase is almost completely due to the start of 170 production.
Looking to the longer term, Embraer says the USA will remain the largest market for regional jets where demand is put at 4,740 aircraft over the next 20 years. This represents 56% of the total regional jet market, which Embraer puts at 8,450 jets. Africa, Europe, and the Middle East will provide 23% of sales, with China coming third with 8%.
Analyst Cameron Doerksen of Canadian bank Dlouhy Merchant warns that Bombardier's regional jet business will slow as there are few orders on the horizon for regional jet airliners. However, there should be "a modest pick-up" starting in late 2005 in business jet deliveries, assuming economic conditions continue to improve.
Bombardier regional jet output "must count on option conversions from customers such as Delta, Northwest, US Airways and United Airlines affiliates like Mesa and SkyWest", says Doerksen. "As such, we believe it is likely that regional jet deliveries will begin to drop in late 2005," he says, adding that Bombardier's future is more closely tied to the business jet market than the airline market.
Source: Flight International
