This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. For an explanation of our Advertising Policy, visit this page.

Boeing may soon have a 100-seat regional jet to sell around the world. The catch: It’s not really a Boeing — it’s the Embraer E2, which it is close to buying from the Brazilian company.

Fresh on the heels of Airbus closing the acquisition of the Bombardier C Series program, Boeing and Embraer are poised to announce their own deal for the US company to acquire the Brazilian planemaker’s commercial jet operations, according to a report from Bloomberg late Tuesday. That would give Boeing a product in the 100-seat regional airliner market, to compete with Airbus’s newly-acquired C Series.

Sources told Bloomberg that Brazilian President Michel Temer has “endorsed the partnership in principle”. This is a major step towards government approval in Brazil, with the president endorsing the recommendation of his cabinet colleagues.

Embraer is the third-largest maker of commercial airplanes in the world by sales after Boeing and Airbus, but it’s still much smaller than the big two.

“I’m sure the fact that they were suddenly the last small jetmaker in the world was a motivator too,” said Richard Aboulafia, vice president at Teal Group, an aviation consulting firm. “It’s all about keeping your supply chain costs low, and the big players have so much more leverage against their vendors.” 
Aboulafia also noted that Airbus got the Bombardier jet for a symbolic sum of one Canadian dollar. “The main difference is that Bombardier gave up their jet to Airbus for free, and even guaranteed them against further development cost overruns.  By contrast, Boeing has to pay for their part of the Embraer joint venture,” he said in an email to TPG.

Brazil’s Defense minister Joaquim Silva e Luna had told Bloomberg in May that “there was concern about preserving investments in our defense base, so that strategic projects wouldn’t be interrupted. That has been overcome.”

The announcement could come within weeks, as previously speculated. 

Embraer would retain control of its defense manufacturing business, but Boeing and Embraer would jointly operate manufacturing, sales, and marketing of the latter’s commercial plane program and in particular the Embraer E2 program. The E2 competes head-to-head with the Airbus-Bombardier C Series program, the 100+ seat twinjet. The C Series is slightly larger than the E2, but occupies the same market segment for single-aisle airplanes smaller than the Boeing 737 and Airbus A320 families.

Featured image of an Embraer E190-E2 by Emily McNutt/The Points Guy

RELATED VIDEO:

American Express® Gold Card

With some great bonus categories, the American Express Gold Card has a lot going for it. The card offers 4x points at US restaurants, at US supermarkets (up to $25,000; then 1x), and 3x points on flights booked directly with airlines or through amextravel.com. It is currently offering a welcome bonus of 35,000 bonus points after you spend $2,000 in the first three months.

Apply Now
More Things to Know
  • Earn 35,000 Membership Rewards® Points after you spend $2,000 on eligible purchases with your new Card within the first 3 months.
  • Earn 4X Membership Rewards® points at U.S. restaurants. Earn 4X Membership Rewards® points at U.S. supermarkets (on up to $25,000 per year in purchases, then 1X).
  • Earn 3X Membership Rewards® points on flights booked directly with airlines or on amextravel.com.
  • Earn up to $10 in statement credits monthly when you pay with The Gold Card at Grubhub, Seamless, The Cheesecake Factory, Shake Shack, and Ruth's Chris Steak House. This is an annual savings of up to $120. Enrollment required.
  • $100 Airline Fee Credit: up to $100 in statement credits per calendar year for incidental fees at one selected qualifying airline.
  • Choose to carry a balance with interest on eligible charges of $100 or more.
  • No Foreign Transaction Fees.
  • Annual Fee is $250.
  • Terms apply.
  • See Rates & Fees
Intro APR on Purchases
N/A
Regular APR
See Rates & Fees
Annual Fee
$250
Balance Transfer Fee
See Terms
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.