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max999
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:03 pm

Boeing reaps what it sowed.

This long saga was initiated when Boeing tried to kill the C series by launching a dumping complaint with the Trump administration. They in turned raised tariffs on the C series which could have potentially killed the program.

Then Airbus came to the rescue, took a majority stake in the C series, and figured out a way to bypass the tariffs. Boeing reacted competitively to Airbus' move by proposing to take over Embraer. And now Boeing's hasty move has ended in an embarrassing failure.

This chain of events would have never happened if Boeing tried to compete with the C series instead of trying to kill it.
Last edited by max999 on Sat Apr 25, 2020 3:04 pm, edited 1 time in total.
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SEU
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:04 pm

I fear the lack of E2 orders, Covid 19, no bailout from Boeing, Embraer will follow Bombardier footsteps unfortunately.
 
Jungleneer
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:10 pm

This is just so sad for Embraer. The E2 is a very good aircraft. The best they have developed so far. Sad for the talented engineers, the assembly line workers. People who really gave their lives for this company.
 
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Revelation
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:22 pm

dopplerd wrote:
Confluence of factors in my view: The lack of a scope compliant E2, Boeing cash position, Brazilian political situation, and finally COVID-19.

Leeham wrote:

Boeing today pulled the plug on its proposed joint venture with Embraer. It claimed the Brazilian company failed to meet all the terms and conditions required of the JV agreement.

“Boeing has worked diligently over more than two years to finalize its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions. We all aimed to resolve those by the initial termination date, but it didn’t happen,” said Marc Allen, president of Embraer Partnership & Group Operations. “It is deeply disappointing. But we have reached a point where continued negotiation within the framework of the MTA is not going to resolve the outstanding issues.”

Ref: https://leehamnews.com/2020/04/25/boein ... t-venture/

I wonder exactly which technicality Boeing used to pull the plug.

Bricktop wrote:
Lots of virtual high-fiving in Toulouse right now. The BCS deal went from very smart to pure genius.

Maybe in the long term, but in the short term A is on the hook to spend hundreds of millions of EUR to buy out BBD this year and similar amounts to fund the ramp up all at a time where it has undelivered jets on the ramp and some future A220 customers hurting or disappearing.

Bricktop wrote:
Knowing very few of the B/E details, the deal is dead for good. They could have extended if it was remotely feasible. IMO, Boeing has pooped the bed on this, especially if it was a price-cutting tactic.

The deal never made sense to me. EMB's product strategy was deeply flawed so EMB would have become cash dependent on the mother ship. Boeing claimed there were engineering synergies but Boeing didn't have a lot of new engineering work to do. It all could have been a knee jerk reaction to the BBD fallout, but to me buying EMB only enhanced the idea that they made a mistake by not buying BBD and gave the EU a nice opportunity to drag its feet to show its displeasure over the BBD case.
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WayexTDI
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:36 pm

I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.
 
426Shadow
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 3:49 pm

As far as I am concerned, the only good thing to come out of this is pretty much killing off any possibility of the KC-390 invading C-130J territory. Job security is king.
We are all just fanboys, our opinions don't make or break businesses.
 
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EMBSPBR
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:14 pm

In a time of crisis, MAX saga, and Boeing possibly turning to the American government for their own survival, more than expected that they would jump out.

A detail that perhaps few know: the commercial division had already been divided, a new company with an open Brazilian registration (Yaborã SA, aka Boeing Brasil Commercial) and the chosen employees already relocated to this new company (with guaranteed labor rights), including their president, John Slattery.
Boeing will have to "dismantle" this structure, with costs for sure.

Boeing will certainly receive money from Trump (read taxpayer) for its survival. But not to save jobs or jobs in Brazil.

They both lose:
- us possible access to a supply chain with a heavy hand from Boeing for negotiations and eventual matching sales in its commercial line;
- Boeing loses in its battle for more efficient engineering, cheaper labor and many headaches, including the ill-fated MAX.

Source: https://boeing.mediaroom.com/2020-04-25 ... raerBoeing waited until the last minute to remove the plug from the wall.

Excerpt:

"Boeing has worked diligently over more than two years to finalize its transaction with Embraer. Over the past several months, we had productive but ultimately unsuccessful negotiations about unsatisfied MTA conditions. We all aimed to resolve those by the initial termination date, but it didn't happen," said Marc Allen, president of Embraer Partnership & Group Operations. "It is deeply disappointing. But we have reached a point where continued negotiation within the framework of the MTA is not going to resolve the outstanding issues."

But, what if the agreement was approved by the European Union before the pandemic?
Only now did it seem that the agreement was not convenient ???

We have a sentence in the Portuguese language to define this situation:
"little flour, my mush first".

For us at Embraer, we are seeing in the mirror what we saw at the time of its privatization: "lose weight", a smaller and restructured company, focused on the product and efficiency, without waste.
Time will tell ...

And, for the worshipers of the "best airplane in the world", before celebrating, look around the "new world" that lies ahead and will never be the same ...
Last edited by EMBSPBR on Sat Apr 25, 2020 4:19 pm, edited 1 time in total.
 
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EMBSPBR
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:14 pm

426Shadow wrote:
As far as I am concerned, the only good thing to come out of this is pretty much killing off any possibility of the KC-390 invading C-130J territory. Job security is king.


Which jobs ? Yours ?
 
Lewton
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:22 pm

ExMilitaryEng wrote:
And more sales for the A220/CSeries and possibly for Mitsubishi...

Who would have believed that just two years ago.

Or 2 months ago.
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scbriml
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:22 pm

426Shadow wrote:
As far as I am concerned, the only good thing to come out of this is pretty much killing off any possibility of the KC-390 invading C-130J territory. Job security is king.


Maybe you missed these words in Boeing's presser?

"Boeing and Embraer will maintain their existing Master Teaming Agreement, originally signed in 2012 and expanded in 2016, to jointly market and support the C-390 Millennium military aircraft."
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scbriml
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:23 pm

It seems that Embraer is not happy with the situation, to say the least.

https://leehamnews.com/2020/04/25/embra ... -remedies/
“Embraer believes strongly that Boeing has wrongfully terminated the MTA, that it has manufactured false claims as a pretext to seek to avoid its commitments to close the transaction and pay Embraer the US$4.2 billion purchase price. We believe Boeing has engaged in a systematic pattern of delay and repeated violations of the MTA, because of its unwillingness to complete the transaction in light of its own financial condition and 737 MAX and other business and reputational problems.

Will seek remedies
Embraer said it will pursue remedies against Boeing.
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Jungleneer
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:26 pm

This will end in court.
 
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lightsaber
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:30 pm

In this economy, I am not surprised.

WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.

The proposal was for economy of scale. Boeing is able to buy rivits, aluminum, automated machine tools, tires, windows, slides, galleys, and landing gear cheaper than Embraer. This deal started because the E2 wasn't selling.

The lack of sales hurts. The lack of a scope compliant aircraft hurts the value. The pacity of E2-190/195 sales is not encouraging either.

I wonder if Boeing walks away with no payment or the $100 million termination fee.

Lightsaber
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EMBSPBR
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:36 pm

lightsaber wrote:
WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.


The proposal was for economy of scale. Boeing is able to buy rivits, aluminum, automated machine tools, tires, windows, slides, galleys, and landing gear cheaper than Embraer.
Lightsaber


:checkmark: :checkmark: :checkmark: :checkmark:

lightsaber wrote:
This deal started because the E2 wasn't selling.Lightsaber


Airlines with purchase intentions awaiting completion of the JV to obtain better purchase conditions ...
 
GDB
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 4:44 pm

You have to feel sorry for the people in Embraer, in 51 years they went from an unlikely new entrant in the industry, to a very major player in the RJ market, as well as in business aircraft and with the KC-390, an innovative military aviation product.
A tie up with Boeing that seemed to be more about Boeing hiding their blushes when they tried to kill another company that did not even really compete with their products, out of spite it seemed,
Plus being in a country that has an even more dangerous buffoon than Trump running it, amplifying not only the Covid risk to their business but their own lives.
 
426Shadow
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 5:16 pm

EMBSPBR wrote:
426Shadow wrote:
As far as I am concerned, the only good thing to come out of this is pretty much killing off any possibility of the KC-390 invading C-130J territory. Job security is king.


Which jobs ? Yours ?


The over 7,000 in plant people here at Marietta, plus the 30,000 or so jobs we support just in the local area. Not taking into consideration, the Meridian site with its 1,000+ people, the Indian's who build the tail section and how ever many people they support, Dowty for the propellers, the list goes on. Say what you want, and be all cold and heartless but what sense does it make to kill off all of those jobs? Military contracting isn't the airline business, there is A LOT of politics involved. There is a reason every US military contractor gets a big contract even though sometimes it seems they didn't deserve it. Nothing you say will change that. So like I said, the C-130 will be safe until we come up with something to replace it.
We are all just fanboys, our opinions don't make or break businesses.
 
tomcat
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 5:17 pm

EMBSPBR wrote:
lightsaber wrote:
WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.


The proposal was for economy of scale. Boeing is able to buy rivits, aluminum, automated machine tools, tires, windows, slides, galleys, and landing gear cheaper than Embraer.
Lightsaber



Well, these economies of scale are only worth for what's made at Embraer (mostly the wingbox manufacturing and the final assy). A large part of the E2 is manufactured by risk sharing partners (including US ones providing jobs in the US) who wouldn't have benefited from these economies of scale but would have suffered from renewed price pressure from Embraer/Boeing.

In the future, if the Embraer engineering resources would be of any use for Boeing, I don't see what would prevent Boeing to contract them. They could actually have started this way in due time rather than splashing 4 billion dollars with no immediate plan to put these resources to good use.
 
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LockheedBBD
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 5:50 pm

https://leehamnews.com/2020/04/25/embra ... -remedies/

“Embraer believes strongly that Boeing has wrongfully terminated the MTA, that it has manufactured false claims as a pretext to seek to avoid its commitments to close the transaction and pay Embraer the US$4.2 billion purchase price. We believe Boeing has engaged in a systematic pattern of delay and repeated violations of the MTA, because of its unwillingness to complete the transaction in light of its own financial condition and 737 MAX and other business and reputational problems.

Will seek remedies
Embraer said it will pursue remedies against Boeing.




Boeing is the best partner one could ask for; they are quick to throw others under the bus and not take responsibility for their own shortcomings. :duck: :yuck:
Last edited by LockheedBBD on Sat Apr 25, 2020 5:58 pm, edited 1 time in total.
 
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LockheedBBD
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 5:54 pm

The question is, would Embraer be interested in a partnership with COMAC? I'm sure China is salivating at the opportunity as they were with the CSeries (before it was ultimately sold to Airbus).
 
WayexTDI
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:01 pm

lightsaber wrote:
In this economy, I am not surprised.

WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.

The proposal was for economy of scale. Boeing is able to buy rivits, aluminum, automated machine tools, tires, windows, slides, galleys, and landing gear cheaper than Embraer. This deal started because the E2 wasn't selling.

The lack of sales hurts. The lack of a scope compliant aircraft hurts the value. The pacity of E2-190/195 sales is not encouraging either.

I wonder if Boeing walks away with no payment or the $100 million termination fee.

Lightsaber

I get that: Boeing, much like Airbus, is the big elephant compared to Embraer and can get better deals than Embraer alone.

But still, to me, that JV proposal was only a response to Airbus & Bombardier tying the knots (and pretty much later Airbus buying Bombardier's share in the common household), as the bride (BBD) was riddle with debt. I never understood why people got so excited about Boeing & Embraer doing the same thing, except for following the mantra "since the other guy did it, let us do it too".
 
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AirlineCritic
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:09 pm

Sad, but also predictable in this situation. Each corporation is in a fight for their survival and there simply isn't any money laying around to make deals on.

Lets see who survives the next year or two, then the dance can start again.
 
F9Animal
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:23 pm

LockheedBBD wrote:
The question is, would Embraer be interested in a partnership with COMAC? I'm sure China is salivating at the opportunity as they were with the CSeries (before it was ultimately sold to Airbus).


What about Airbus? I find it difficult to think this could mean the end of Embraer. They have a solid product, and I just can't see them just bowing out. Yep, times are tough, but Embraer stands a solid chance of surviving this storm IMO.

Now if things are grim at Embraer, Airbus could easily swoop in and own the Regional market perhaps? As for Boeing? I don't feel the least bit sorry for them. What they did to the C-Series was absolutely disgusting. Boy did that come back to bite them. Karma is a mofo!
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dtw2hyd
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:25 pm

Current economic conditions aside, strategically it is a myopic move. Boeing needs to break away from 737 shackles. E2 was their jail free card and as always they blew it.
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Revelation
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:25 pm

From the Seattle Times:

Boeing had seen Embraer as providing a new line-up of smaller jets to extend its airplane offerings.

It had also hoped to gain from Embraer’s substantial engineering talent in Brazil. Embraer’s facilities near São Paulo were slated to “become one of Boeing’s centers of excellence for end-to-end design, manufacturing, and support of commercial passenger aircraft, and will be fully integrated into Boeing’s broader production and supply chain,” Boeing had said.

Hamilton believes this was Boeing’s primary motivation: “to get access to the low-cost Brazilian engineering workforce” with an eye to helping develop its next new airplane.

That plan has now evaporated, as has any prospect of Boeing launching a new jet in the next few years.

Basically the sales weren't materializing and with COVID-19 they won't be, and there won't be a need for a new airplane any time soon either.

I always had my doubts that Boeing would get a lot of value from the relationship. I think FAA has raised the bar on any new airplane so a lot of new tech will need to be developed and I think that Boeing will want to keep that close to home.

For an intersting hot take:

Hamilton considers disingenuous Boeing’s insistence that the deal fell apart only because of a failure to agree on closing terms.

“That’s just so they don’t have to pay the breakup fee,” he said.

Ref: https://www.seattletimes.com/business/b ... of-embraer
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docmtl
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 6:46 pm

And here comes the Chinese to pick up this deal...

There’s no void in nature...
 
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Revelation
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 7:18 pm

Reuters spells out the grievances:

People familiar with the matter said Boeing had raised objections during talks about funding and legal matters, which Embraer regarded as a deliberate bid to frustrate the deal.

Others said the dispute revolved around how much Embraer had invested in the commercial aerospace unit pending a final deal, as well as the progress of technical and contractual paperwork.

Embraer said it had met its commitments.

Ref: https://www.reuters.com/article/us-embr ... SKCN2270KN
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GEUltraFan9XGTF
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 7:59 pm

Mixed feelings I guess. As a US taxpayer, I am pretty sure my money will go to bailing out BAC, hopefully with strings attached, as in shares and hopefully a gutting of senior and mid level management (and forced relocation from Chicago to Seattle). As such, BAC spending billions on an acquisition is simply not prudent nor responsible in the COVID climate. I just don't think it would have been worth the investment, long-term. Better and cheaper to lure all that Brazilian talent to the US, post-Trump.

As beautiful as the C-Series/A220 is, it is expensive. Airbus has a lot more to pay before it sees any gains from it. As was said earlier, a lot of the LCCs who wanted it will not exist, After Covid. If the word from DL is to be believed, it is also dog when it comes to maintenance. I don't think they are celebrating in Toulouse; that is just fanboi fantasy talk.

What Boeing has done is piss off both its north and south American neighbors. It has pissed off everyone. This could also be yet another step on its slide into oblivion.
Last edited by GEUltraFan9XGTF on Sat Apr 25, 2020 8:07 pm, edited 1 time in total.
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9Patch
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 8:04 pm

WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.


When the JV was announced in 2019, the advantages for Boeing were:

Access to EMB engineers at a time when Boeing’s are aging and ready to retire.
Access to much lower cost base in Brazil.
KC-390 program.
Revenue from EMB Commercial services.
E2 program, though this is tangential.

The advantages for Embraer were:

Access to Boeing’s vast customer base, marketing power, balance sheet (again, pre-virus) and capital markets.
Access to work on new airplane programs: NMA (at the time), Future Small Airplanes (single aisle, either to compete with A220 or larger).
Work for its engineers.
A future beyond the struggling E2 and beyond the fanciful turboprop concept.
A future for Embraer Commercial Airplanes, which in LNA’s view was increasingly risky.

https://leehamnews.com/2020/04/25/analy ... t-venture/
 
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GEUltraFan9XGTF
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 8:10 pm

EMB may have also dodged a bullet here. Most of those advantages are now gone. Getting married to BAC could have been like boarding the Titanic from Southampton.
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smartplane
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 8:15 pm

Revelation wrote:
Reuters spells out the grievances:

People familiar with the matter said Boeing had raised objections during talks about funding and legal matters, which Embraer regarded as a deliberate bid to frustrate the deal.

Others said the dispute revolved around how much Embraer had invested in the commercial aerospace unit pending a final deal, as well as the progress of technical and contractual paperwork.

Embraer said it had met its commitments.

Ref: https://www.reuters.com/article/us-embr ... SKCN2270KN

What goes around around, comes around.

For MAX, 787 and X customers looking to escape their orders, commitments, and retrieve deposits unscathed, the JV courtship and Boeing's escape excuses, will provide a useful template.
 
9Patch
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 8:33 pm

GEUltraFan9XGTF wrote:
EMB may have also dodged a bullet here. Most of those advantages are now gone. Getting married to BAC could have been like boarding the Titanic from Southampton.


Covid changed everything:

Paying around $5bn for a company that has a market value closer to $1bn is problematic. Assuming Boeing takes federal money, however the deal may be structured, would present huge political problems if Boeing sends $5bn to Brazil.

https://leehamnews.com/2020/04/25/analy ... t-venture/
 
MEA-707
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 8:48 pm

I can't understand why Embraer doesn't run back to the drawing table, cut out a slice (one seatrow) off of the Emb 175 E2. The old 175 was the only properly selling airplane they had, and a newer more efficient light enough for Scope version should be awesome.
nobody has ever died from hard work, but why take the risk?
 
neutronstar73
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 9:20 pm

WayexTDI wrote:
I never understood that JV proposal, except as a "me too" knee-jerk reaction after the Airbus/BBD deal.
It the Boeing/Embraer deal was so solid in the first place, it would have happened already or been extended; maybe another blessing in disguise for Boeing.


Boeing knew they blew it when they didn't accept BBD's offer of a tie up. Then when Airbus got it, Boeing realized they screwed up.

Bad business at Boeing these days. And it all started with that boneheaded complaint against bombardier
 
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PepeTheFrog
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 9:39 pm

It's going to get ugly...

Embraer to seek damages as it accuses Boeing of sabotaging merger

The lawyers will have to sharpen their pencils ...
Good moaning!
 
strfyr51
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 9:51 pm

It could be that Embraer overplayed their Hand! They may have thought that they could pressure Boeing into some great deal for them sine Boeing Bungled their way into their current mess and thought Boeing Needed them MORE than they needed Boeing. They didn't take into mind that Mitsubishi is also building and testing the MRJ right up there in the Pacific Northwest and may very well also want to partner with Boeing. Boeing might have had an occasion to act stupid. But they are FAR from Stupid.
 
jfk777
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 10:01 pm

Embraer would be better off making a deal to let Boeing market their planes than battle them and sue them. Embraer can't be blind the facts of Boeing's problems, even with they can taste the $ 4 billion dollars not coming anymore. A deal of short of merging would be in everyone's interest.
 
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EMBSPBR
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 10:27 pm

strfyr51 wrote:
Boeing Needed them MORE than they needed Boeing. They didn't take into mind that Mitsubishi is also building and testing the MRJ right up there in the Pacific Northwest and may very well also want to partner with Boeing.


Good luck to them ... a perfect marriage of efficient engineering . :stirthepot: :stirthepot: :stirthepot:
 
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EMBSPBR
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 10:31 pm

jfk777 wrote:
Embraer would be better off making a deal to let Boeing market their planes than battle them and sue them. Embraer can't be blind the facts of Boeing's problems, even with they can taste the $ 4 billion dollars not coming anymore. A deal of short of merging would be in everyone's interest.


Boeing terminated the deal.
Not Embraer !!!
 
D L X
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 10:56 pm

It would be really nice if this were a new thread on the news of the termination so we don’t have to wade through 17 pages of other stuff.
 
afgeneral
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sat Apr 25, 2020 11:19 pm

dopplerd wrote:
Confluence of factors in my view: The lack of a scope compliant E2, Boeing cash position, Brazilian political situation, and finally COVID-19.


nah, this Boeing being overly cautious in making anything happen and dragging their feet + being in a really bad cash position due to 737 MAX, it's like taking 10 years to marry someone

if you are not quick, things can happen along the way - political change, unions maneuvering to kill the product, once in a century pandemic etc.

Airbus - C-Series deal seemed to happen almost overnight in comparison
 
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ojjunior
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 1:20 am

Well there will be an emergency conf call with some Embraer big dogs tomorrow (yes, sunday) at 11AM BR time.
Who's not invited knows nothing about what's going on or aren't that important in Embraer's structure.
Let's wait for Monday news.
 
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lightsaber
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 1:30 am

afgeneral wrote:
dopplerd wrote:
Confluence of factors in my view: The lack of a scope compliant E2, Boeing cash position, Brazilian political situation, and finally COVID-19.


nah, this Boeing being overly cautious in making anything happen and dragging their feet + being in a really bad cash position due to 737 MAX, it's like taking 10 years to marry someone

if you are not quick, things can happen along the way - political change, unions maneuvering to kill the product, once in a century pandemic etc.

Airbus - C-Series deal seemed to happen almost overnight in comparison

The pace of this deal was odd. Normally deals should happen quickly (as in 3 to six months). The long duration, as you already noted, put the deal at risk. The pace always confused me.

The relatively few E2 sales during the negotiations certainly reduced the enthusiasm.

Lightsaber

Late edit:
https://www.bing.com/amp/s/www.fool.com ... t-mea.aspx

Boeing was going to pay $4.2 billion for 80% of a company worth about $1.4 billion. Err... I think the market already priced out this deal.

I wish Embraer well. But I have no idea how they can sell 150+ E2s quickly to boost the economy of scale of the production line.
Winter is coming.
 
planecane
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 1:58 am

dtw2hyd wrote:
Current economic conditions aside, strategically it is a myopic move. Boeing needs to break away from 737 shackles. E2 was their jail free card and as always they blew it.


The E2 is smaller and less capable than the 737MAX. This JV wasn't going to help with the MAX situation. It probably would have been used for at least the smaller size end of the 737 replacement but that wasn't happening for several more years anyway.

The C-series would possibly have helped Boeing with the MAX situation but not the E2.
 
kaneporta1
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 2:12 am

GEUltraFan9XGTF wrote:
If the word from DL is to be believed, it is also dog when it comes to maintenance. I don't think they are celebrating in Toulouse; that is just fanboi fantasy talk.

What Boeing has done is piss off both its north and south American neighbors. It has pissed off everyone. This could also be yet another step on its slide into oblivion.


Considering that Delta's entire A220 fleet is currently flying, that is a pretty good indication of what the company thinks of this aircraft.

And honestly, Toulouse must be celebrating right now. Their primary A220 competitors are a company without a certified aircraft (Boeing) or a company whose viability will surely be questioned by potential future customers (Embraer). Actually Embraer is now where Bombardier was 3-4 years ago. Good products, but too risky for potential customers.
I'd rather die peacefully in my sleep, like my grandfather, not terrified and screaming, like his passengers
 
txkf2010
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 2:15 am

Maybe Lockheed will get back into the commercial arena!
 
afgeneral
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 2:32 am

lightsaber wrote:
The pace always confused me.

The relatively few E2 sales during the negotiations certainly reduced the enthusiasm.

Lightsaber


Indeed, just imagine Airbus doing the same with the C-Series.

Deal taking 24 months to complete and then along the way Airbus complaining that US regulators are killing DL orders + slow sales generated by the business as it is. Potential buyers would not buy into it unless there was hard commitment from the buyer.

You either commit to doing a deal or not.
 
MSPNWA
Posts: 3698
Joined: Thu Apr 23, 2009 2:48 am

Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 2:45 am

We'll see what the lawyers say, but now is not the time to spend billions on a company worth a fraction of that. Boeing is very fortunate that coronavirus hit before the deal was completed. Airbus wasn't so fortunate with their CSeries anchor. Coronavirus will reward the manufacturer that can shrink the fastest. Boeing is in that position if the law is in their favor.

Hopefully Embraer survives on their own and can revisit this if the bridges aren't too badly burned. I don't have a high hopes though, not with the E2 being too large for U.S. scope clauses and too small for competitiveness in a mainline usage. I don't blame them for fighting tooth and nail to keep the deal. They may not live without it.
 
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flee
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 3:02 am

GEUltraFan9XGTF wrote:
What Boeing has done is piss off both its north and south American neighbors. It has pissed off everyone. This could also be yet another step on its slide into oblivion.

Yes, very sad that Boeing got so cocky as it has become "too big to fail". They have really pissed of everyone - customers, suppliers, partners, competitors, etc. If its Management does not wake up now, your forecast may prove to be true.
 
744SPX
Posts: 290
Joined: Mon Jan 27, 2020 6:20 pm

Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 4:29 am

Hopefully Embraer's next-gen turboprop will still see the light of day without Boeing financial assistance.
 
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LockheedBBD
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Re: Updated: Boeing Terminates Agreement to Establish Joint Ventures with Embraer

Sun Apr 26, 2020 6:59 am

txkf2010 wrote:
Maybe Lockheed will get back into the commercial arena!


One can dream. :cloudnine:

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