RE:RE:Sounds LikeAll Deals can be cancelled - It would seem...
Boeing, Embraer scrap cooperation as pandemic shrinks jet market
Boeing Co. is walking away from its proposed combination with Embraer SA’s commercial-jet business, ending more than two years of talks, as the planemakers brace for a far smaller market for aircraft after the coronavirus pandemic.
“We have reached a point where continued negotiation within the framework of the MTA is not going to resolve the outstanding issues,” Marc Allen, president of Embraer Partnership & Group Operations, said in a statement Saturday.
The collapse turns two long-time trade partners into competitors and strengthens Airbus SE’s hand in the lucrative market for single-aisle jets. Boeing and Embraer will, however, 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.
The deal would have bolstered Boeing’s ability to compete with Airbus by adding Embraer’s small jets to the U.S. aerospace giant’s product lineup through a commercial partnership.
Boeing is abandoning the proposed tie-up weeks after Chief Executive Officer Dave Calhoun warned employees that the company would need to adjust to a “new reality” as travel demand collapses and airlines prepare for a slow recovery. Embraer’s market value has tumbled to less than US$1.1 billion, about one-quarter of what Boeing had been poised to pay for the Brazilian company’s commercial plane operations alone.