Embraer reports that it has reached an agreement with the Brazilian Air Force (FAB) regarding the contractual discussion on the order for the KC-390 multi-mission aircraft. As a result, the total number of aircraft to be contracted by the FAB will be reduced from 28 to 22 units, with deliveries scheduled through 2034. The new production rates are in line with the FAB’s budgetary conditions and allow Embraer to plan for the long term with its suppliers.
Brazilian Air Force’s intention to renegotiate the contract with Embraer arose from the budget reduction suffered by the Force, severely hit, like other state institutions, by the global Covid-19 crisis.
The press release issued by the FAB at the end of May last year stated that under the new economic conditions it was impossible to acquire the 28 units originally agreed. Therefore, it sought to reduce its number to 18 aircraft, later cut to just 15. In addition, the FAB wanted to space out the pace of delivery of the KC-390s to beyond 2027, in order to be able to space out payments and take pressure off its annual budget.
The KC-390 can fulfill a wide range of missions, such as humanitarian support, medical evacuation, search and rescue, and cargo and troop transport and airdrop, in addition to aerial refueling. In fact, the operational experience of the FAB’s KC-390s during domestic operations fighting Covid-19, and abroad, such as casualty support in Lebanon and Haiti seems to have worked against Embraer. The effectiveness levels and high operational availability rate demonstrated so far suggest that the KC-390 can perform more missions, with a smaller fleet of aircraft than planned.
The current agreement reached between the two parties allowed the reduction of units from ten aircraft to six, much less traumatic for Embraer and for the FAB’s operational needs. In exchange, delivery schedules are extended to 2034, which will cut the KC-390 delivery rate by more than half.
In the meantime, there is no doubt that Embraer will continue to carry out aggressive promotional campaigns abroad to try to compensate with export orders for the aircraft that will no longer be delivered to the Brazilian Air Force.
