US Tariffs Could Have Pandemic-like Impact on Planemaker Embraer

Embraer Warns U.S.Tariffs Could Devastate Revenue at COVID-Level Impact

New 50% tariffs onBrazilian exports threaten to disrupt deliveries, inflate costs by millions perjet, and severely affect Embraer's U.S. business

A Critical Warning from Embraer's CEO

Embraer CEO Francisco Gomes Neto has issued a stark warning about the potential impact of newly proposed 50%U.S. tariffs on Brazilian exports. Scheduled to take effect on August 1,2025, the tariffs could damage Embraer's revenue as severely as the COVID-19 crisis, which led to significant financial losses across the aviation industry.

U.S. Market at Serious Risk

The United States represents a critical market for Embraer, accounting for:

• 45% of its commercial jet exports
• 70% of its executive jet deliveries

The proposed tariffs could raise the cost of each aircraft exported to the U.S. by as much as $9 million, rendering deliveries economically unfeasible for both Embraer and its American customers.

Potential Consequences

If implemented, the tariffs may lead to:

• Order cancellations or deferrals
• Reduced investment in production     and innovation
• Possible job cuts within Embraer
• Significant strain on U.S.  regional airlines that rely on Embraer jets

Despite these risks, the company has not yet seen any cancellations but remains on high alert as the deadline approaches.

Outlook and Industry Concern

Describing the tariffs as a de facto trade embargo, Gomes Neto emphasized the need for urgent resolution to avoid long-term damage to U.S.-Brazil aviation ties. Industry groups, including IATA, have also expressed concern that uncertainty could make U.S. airlines hesitant to proceed with scheduled deliveries.

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