Sixteen years is not such a long time in the aviation business. It might only cover the entire production of a single aircraft type, such as the Cessna Citation CJ2, for instance, which ceased production in January after a 16-year run.
Alternatively, the same period spans the entire history of Embraer Executive Jets, arguably the most disruptive force in business aviation over the last two tumultuous decades.
Within a single product cycle, Embraer has introduced major product lines in nearly every category of the business aviation market, survived a painful market downturn, established a substantial manufacturing and engineering presence in Florida and led a radical change in how the entire market conceptualises and designs cabin interiors.
“It’s like a dream,” says Marco Tulio Pellegrini, president and one of the founding employees of Embraer Executive Jets.
Speaking on 19 April at a ceremony marking the 1,000th delivery of an Embraer Executive Jets product, Pellegrini allowed himself to candidly reflect on how improbable such an occasion would have seemed even a decade ago.
“If you asked me [in 2005] if it would be possible to do all of this in 10 years I would say ‘no’”, Pelligrini says.
To understand Pelligrini’s perspective, it helps to revisit the company’s remarkable growth trajectory over a time period when several established business jet manufacturers struggled to survive.
The history of Embraer Executive Jets actually begins two years before it was organised as a dedicated business unit in 2002.
Back then, Embraer was still riding the 50-seat regional jet boom of the late-1990s. Sensing an opportunity to capitalise on the hot-selling commercial ERJ-series, Embraer launched what was then branded simply as the Legacy, at Farnborough air show in 2000. The significance of that moment would have been easily overlooked during the event itself, as all eyes were focused on the debut of the newly-organised EADS company. Yet it would mark Embraer’s first move into the business aviation market.
At the time, Pellegrini was still working on Embraer’s production team, responsible for turning paper commercial designs into metallic reality in the factory. But in 2002 he was recruited by the company’s executives to join a new unit called Embraer Executive Jets, led by a former aviation analyst for the Brooke Group investment firm. When Pelligrini joined the team, there was no clear vision for moving beyond derivatives of the ERJ in the business jet market.
Moreover, Embraer also still knew very little about the business jet market. Its regional jet rival, Bombardier, had expanded into commercial aviation after finding success in the business aviation market with the Challenger 600. Embraer had no such pedigree, a fact that was all too apparent to Pelligrini.
“We brought the Legacy to the market in 2002, but we didn’t know,” Pelligrini says. “We didn’t understand the customer requirements, and what’s necessary to be successful. And I didn’t know anything about executive aviation.”
In retrospect, the original Legacy reflected Embraer’s learning curve in the business jet market. The regional jet derivative found its niche, but the product’s performance and interior would be revamped in 2012. By that time, however, Embraer Executive Jets had learned the market it served quite well, thanks to the launch of four clean-sheet aircraft types.
According to Pellegrini’s recollection, the Phenom series began with two strikes against it. Originally conceptualised as an Eclipse-like air taxi, it would have to be reimagined as a slightly larger aircraft pitched against industry heavyweights, such as Cessna and the then-Raytheon owned Hawker Beechcraft brand. More ominously, the group’s proposal to spend hundreds of millions to certificate a clean-sheet business jet landed like a thud in Embraer’s executive boardroom, where then chief executive Maurício Botelho was already consumed by the expense and energy required to push the E170 aircraft through the certification process.
“Embraer was developing a 70-seat and a 100-seat plane, and we approached Maurício and [said]: ‘What do you think about this small four-seat configuration?’ And he almost killed us,” Pellegrini recalls. "Imagine a company that had been on the commercial side and [certificating] the E-Jet, and someone brings in an air taxi!”
Thankfully, Botelho didn’t kill Pellegrini’s team. But the air taxi concept had to go. It was at least four years before the cracks in Eclipse Aviation’s air taxi-based business model would become clear, but Embraer was spared the same fate.
The manufacturer’s narrow escape from the doomed air taxi model could be credited to a flash of executive foresight. But the Brazilian company received critical assistance from one of its customers. Cleveland-based Flight Options, a fractional jet services provider, owns a portfolio of Embraer jets that now includes six Legacy 600s, 36 Phenom 300s and a Legacy 450. In 2003, however, the company’s most important contribution to Embraer was practical guidance on the needs of the business aviation market.
“Without Flight Options I don’t think we would be here today,” Pellegrini says. “[It] allowed us to present the Legacy 600 value proposition, which was very good learning for us. We redesigned the interior, redesigned the spec and improved the range and the ceiling level.”
Flight Options also helped Embraer shape the Phenom series from a clean sheet of paper, with the Phenom 100 as an entry-level and pilot training platform and the larger Phenom 300 as a versatile tool for business owners and fractional fleet operators.
By the time the Phenom 100 entered service in 2008, however, the market outlook appeared completely different than it had in 2005, when the makers of light jets were still riding a credit-fuelled boom in sales. By the end of 2008, the global financial crisis had wiped out the bottom of the business jet market. Still, the Phenom 100 entered service with a respectable backlog that would prove enduring. The more expensive Phenom 300, however, would appear later in a shroud of uncertainty at Embraer. Although delivered with the performance and price Embraer had promised in 2005, the market was slow to respond in the depths of an economic recession four years later.
“My bosses were asking, ‘What’s wrong with this plane because you are not selling it?'” Pellegrini remembers.
They need not have worried. Although the Phenom 300 started slowly, the type quickly made up for it, becoming the best-selling aircraft across the industry for the last two years.
Embraer continued to build momentum. Two more clean-sheet aircraft – the Legacy 450 and 500 – were in the early stages of development yet already redefining performance and technology in the super-light and midsize segments. The Lineage 1000, a VIP remake of the E190 regional jet, would join the redesigned Legacy 600 and Legacy 650. Finally, Embraer opened a new final assembly and engineering complex in Melbourne, Florida.
In 2016, Embraer has seven products to offer the business aviation market, accounting for 17% of all deliveries by volume. For the first time in more than a decade the company is building business jets rather than developing new ones but it still has long-term ambitions. The company acknowledges a gap in its portfolio for an ultra-long-range, large cabin jet, although that segment of the market has high barriers to entry. It has multiple options as it decides the next move, perhaps to respond to Textron Aviation’s recent product expansion with the 4,500nm-range Cessna Citation Hemisphere.
For now, however, Embraer can enjoy the fruits of a remarkable 16-year run.
“Now it is the time,” says Pellegrini, “for executive aviation to generate the cash and to generate the results for the company.”
CORRECTION: The article has been updated to correct the maximum range of the Cessna Citation Hemisphere.
Source: Flight Daily News
