Boeing, Embraer Talk ‘Combination’

Boeing and Embraer are in talks for what might become the absorption of the Brazilian manufacturer by the Chicago-based giant. Although Boeing is cagey about the talks, saying they are about a possible “combination” of the two aerospace companies, most industry pundits are using the term “takeover” to describe the corporate manoeuvring. Such a merger or whatever it might become has been speculated for years but news of the talks came the day after the U.S. Commerce Department confirmed almost 300 percent import duties on Embraer rival Bombardier’s new CSeries airliner.

The duties were announced months ago and resulted in Bombardier trading a 51 percent stake in the program to Boeing rival Airbus in exchange for marketing and manufacturing muscle and a back door to the U.S. market via Airbus’s factory in Mobile, Alabama. While speculation about what the new company might look like titillated financial and aviation columnists, it seemed to irritate at least some in the Brazilian government. Brazil uses Embraer to develop and produce many of its military aircraft and government officials were quoted in Brazilian media as saying they were not sure how any takeover would be handled. “The difficulty is to transfer control of the Embraer to another company,” said Brazilian President Michel Temer “No one examines the issue of transfer.”