LATAM Airlines mulls possible purchase of up to 30 Embraer jets, Brazil minister says

SAO PAULO, – LATAM Airlines could potentially buy as many as 30 aircraft from Brazilian planemaker Embraer as the carrier looks to expand operations in Latin America’s largest economy, Brazil’s ports and airports minister said on Tuesday.

WHY IT’S IMPORTANT

The local unit of Chile-based LATAM, Brazil’s No.1 airline by market share, wants to expand its fleet but faces extended narrowbody delivery times from manufacturers.

Brazil’s government has long urged local carriers to buy Embraer aircraft to boost regional aviation and strengthen the manufacturer, and has signaled that could be a requirement for it to support them financially.

ADDITIONAL CONTEXT

LATAM Brazil’s head Jerome Cadier last week said the company was weighing the possibility of adding smaller aircraft to its fleet, such as Embraer’s E2 or Airbus’ A220, which compete in the regional segment for up-to-150-seat aircraft.

Cadier did not specify how many planes the carrier could add. LATAM currently flies Airbus narrowbodies and Boeing widebodies.

KEY QUOTES

Brazil’s Ports and Airports Minister Silvio Costa Filho told reporters that he met with LATAM CEO Roberto Alvo and Brazilian President Luiz Inacio da Silva in Chile recently to discuss the airline’s growth plans.

“They expect to grow more than 10% in the next three years and are considering a purchase of some 30 aircraft that could be from Embraer.”

“LATAM has indeed opened talks with Embraer and we have been working so they can analyze a purchase of Embraer planes. But we cannot impose a deal, that would be incomprehensible and a very bad sign for free markets.”

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