Commercial Aviation Update

Paulo César de Souza e Silva

President - Commercial Aviation Oct/2013

Commercial Aviation Update

Paulo César de Souza e Silva

President - Commercial Aviation Oct/2013

This information is property of Embraer and cannot be used or reproduced without written permission.

Strategic Objectives

• Leadership in the Commercial Aviation (up 130 seats)

• Increased results from Services and Support

• Products that satisfy market needs (reliable, efficient, flexible, passenger appeal and

preference, performance and economics)

• Diversified customer base

• Customer base expansion through leasing companies

• Excellence in Customer Experience (ECE)

This information is property of Embraer and cannot be used or reproduced without written permission.

ERJ 145 Family

• 715 ERJs in service with schedule & non-

schedule airlines

• 535 ERJs in USA

• Hub feeder (low-mid density markets)

• Increased presence in non-mature countries – regional air transportation:

• Africa (from 2008 to 2013):

• ERJ fleet increased from 8 to 39 ; Operators from 5 to 15

Air Namibia - Namibia Air26 - Angola SA Airlink – South Africa

Swaziland Airlink - Swaziland Punto Azul - Equatorial Guinea Mocambique EXpresso -

Mozambique

This information is property of Embraer and cannot be used or reproduced without written permission.

110 118

343

619

876

947

46

209

490

699

Net Orders

Deliveries

E-Jets � Global Market Success

1,360+

1,000+

1999-2000 2001-2002 2003-2004 2005-2006 2007-2008 2009-2010 2011-3Q13

Source: Embraer (Sep/2013 - Scheduled Airlines and Leasing Co.)

This information is property of Embraer and cannot be used or reproduced without written permission.

1,000 E-Jets Delivered

Nov 2010Nov 2010Sep 2009Sep 2009Dec 2008Dec 2008May 2008May 2008

Dec 2006Dec 2006

Oct 2007Oct 2007

Mar 2004Mar 2004

First DeliveryFirst Delivery

Oct 2005Oct 2005

Sep 2011Sep 2011

Sep 2013Sep 2013

Oct 2012Oct 2012

This information is property of Embraer and cannot be used or reproduced without written permission.

Leadership in Commercial Aviation

50%

24%

12%

7%

7%

Net Orders Market Share

Others

Bombardier

Comac

Sukhoi

E-Jets: since 2004

50% of orders 61% of deliveries

Source: Embraer and OEMs

(2004-Sep/2013: 70-130 seat jets)

61%32%

7%

Deliveries Market Share

Others

Bombardier

This information is property of Embraer and cannot be used or reproduced without written permission.

2013: Market Confidence on E-Jets

Customer Firm Orders

Republic – American Eagle 47 E175

United Airlines 30 E175

Austral Líneas Aéreas 2 E190

Air Costa 1 E190

SkyWest Airlines40 E175

100 E175-E2

Conviasa 7 E190

Japan Airlines 4 E170

ILFC25 E190-E225 E195-E2

Aurigny Air Services 1 E195

Belavia 2 E195

284 Firm OrdersSource: Embraer (Oct/13)

This information is property of Embraer and cannot be used or reproduced without written permission.

7,9 7,6 7,7

5,8

11,5

0

2

4

6

8

10

12

14

Dec/2009 Dec/2010 Dec/2011 Dec/2012 Sep/2013

US

$ B

illi

on

Backlog Evolution

Source: Embraer

This information is property of Embraer and cannot be used or reproduced without written permission.

Diversified Customer Base

65 Airlines from 46 CountriesOct/2013

E-Jets

This information is property of Embraer and cannot be used or reproduced without written permission.

0

1

2

3

4

5

6

7

8

9

10

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013

E-Jets � Global Market Success

Source: Embraer (former E-Jets operators not included)

Customer Base – Increased number of Operators

This information is property of Embraer and cannot be used or reproduced without written permission.

E-Jets Financing Partners

Source: Embraer (Jun/2013)

Yangtze River International

Leasing

Yangtze River International

Leasing

This information is property of Embraer and cannot be used or reproduced without written permission.

E-Jets Worldwide Presence

431 E-Jets

34 Operators

30 Countries

Developed(Mature)Markets

Developed(Mature)Markets

Developing air transportation in Emerging MarketsBringing further network efficiency in Developed Markets

823 E-Jets

30 Operators

16 Countries

EmergingMarketsEmergingMarkets

Source: Ascend, Global Insight Fleet in Service + Backlog, Scheduled Operators only.

This information is property of Embraer and cannot be used or reproduced without written permission.

Developing Network in Africa

Source: Kenya, OAG

E190

E170

This information is property of Embraer and cannot be used or reproduced without written permission.

Developing a Hub in Argentina

Source: Aerolineas Argentinas (May/2013)

This information is property of Embraer and cannot be used or reproduced without written permission.

Replacing Less Efficient Aircraft in Europe

20 Fokker 100

10 Fokker 100, 5 Fokker 70

10 Avro RJ100, 2 Avro RJ85

22 E190

10 E190, 16 E170

9 E190, 6 E170

22 E190

This information is property of Embraer and cannot be used or reproduced without written permission.

Efficient Capacity Management in Europe

Non-peak ���� E195 complementing narrowbody operations

A320

E195

A321

E195

A320

E195

Rome

Munich

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Flights(x10)

Seats Offered(x1000)

Average Fare(USD)

Flights(x10)

Seats Offered(x1000)

Average Fare(USD)

Adjust capacity to market demand � Lower costs and improved results

Source: Delta, SABRE, Embraer

6:00

8:00

10:00

12:00

14:00

16:00

18:00

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

A319

Jun/2011 Jun/2013

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

E175

1H11

220

15 Daily Flights

270

- 48%

E175 Lower Trip Cost

vs. 1H13

(Monday to Friday)

227244

172

Turnaround in US Shuttle Markets

221

Load FactorImprovement

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ECE: Excellence in Customer Experience

Aircraft Availability

QualifiedPeople

Low OperatingCost

Product Competitiveness

Global Presence

• Airline Support

• Customer Care Center

• Customer Relationship

• Efficient Maintenance

• Efficient Operation

• Entry Into Service

• Product Robustness,

Support and Services

• MRO Network

• Parts Availability

• Product Improvements

• Product Quality

• Suppliers Management

• Training

EC

E

Pro

jec

ts

Customer Satisfaction

Highest levels of customer experiencewith Embraer products and services

This information is property of Embraer and cannot be used or reproduced without written permission.

E-Jets: Manufacturing Efficiency ImprovementsAutomation (improved quality, cost and cycle reduction)

A/C painting

Wing drilling

• E-Jets Production Cycle (months): 2004: 4,6 ���� 2008: 3,5 ���� 2012: 2

This information is property of Embraer and cannot be used or reproduced without written permission.

E-Jets: Product Improvement

Reduced HorizontalTail Gaps

New Wingtip(E175 only)

Door Rain DeflectorOptimized

New Ram Air Door New Wheel

Fairing

ImprovedTail Cone

New RedBeacon

ECS & Anti-IceOptimization

All improvements are retrofittable, except the E175 wingtip

This information is property of Embraer and cannot be used or reproduced without written permission.

Flight tests being developed as planned (EIS 1H2014)

This information is property of Embraer and cannot be used or reproduced without written permission.This information is property of Embraer and cannot be used or reproduced without written permission.

This information is property of Embraer and cannot be used or reproduced without written permission.

E-Jets Family EvolutionRight Capacities to Match Market Demand

same

70

90

80

100

110

120

130

Seating

88 pax SC

80 pax DC

106 pax SC

97 pax DC

132 pax SC

118 pax DC

20%

20%

This information is property of Embraer and cannot be used or reproduced without written permission.

Applications & Market Size

20-Year Market Forecast (70 to 130-seat Jets) : 6,400 Deliveries *

� Most efficient “hub feeder”

� Lower cost-per-seat than current Turboprops

� Efficient complement to narrowbody operations

� New market developer

� Capacity growth for current E-Jet operators

� Similar cost-per-seat to A320neo and 737-8 Max

� Low Cost operation in mid-density markets

E190-E2

E195-E2

E175-E2

* Embraer market forecast

This information is property of Embraer and cannot be used or reproduced without written permission.

2S

ho

w ©

20

13

180+

160

140

120

100

80

SSJ95/100SSJ95/100SSJ95/100

MRJ90MRJ90MRJ90ARJ21ARJ21ARJ21

CRJ900CRJ900

CRJ1000CRJ1000

CRJ700CRJ700

CRJ900

CRJ1000

CRJ700

Capacity

(Single Class)

737-7 MAX737-7 MAX737-7 MAXA319neoA319neoA319neo

A320neoA320neoA320neo

737-8MAX737-8MAX737-8MAX

CS100CS100

CS300CS300

CS100

CS300

E175-E2E175-E2

E190-E2E190-E2

E195-E2E195-E2

E175-E2

E190-E2

E195-E2

Competitive Scenario

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E175-E2E175-E2E190-E2 & E195-E2E190-E2 & E195-E2

New Wing

More efficient, high aspect

ratio wing. Raked wing tip.

Improved Avionics

4 larger 14”x10” displays

and touchscreen controls

Main Landing Gear

Enabling larger engines. Gear

doors for improved fuel efficiency

Optimized Wing/Engine

Unique wing and engine combination for E175-E2 and E190/195-E2

New Engines

Larger fan diameter and

improved fuel efficiency

E2 New Features | Not Just a Re-engine

This information is property of Embraer and cannot be used or reproduced without written permission.

E2 Maintenance Cost Advantage

15% Lower Maintenance Cost

E-Jets baseline as per 2012 conditions.*2,600FH/Yr & 1.5FH/FC; 10 years DMC

� 40% longer intervals (850FH / 8,500FH).

� 10% lower cost for maintenance

checks.

� 30% to 40% longer Engine Time On

Wing until 1st SV.

� Up to twice longer Engine Time On

Wing until 2nd SV.

� Lower components repair cost.

This information is property of Embraer and cannot be used or reproduced without written permission.

E190-E2 Joint Definition Phase

� Main suppliersselected

� Digital Mock-Upassembly

� Interfaces definition

� Colocated team of 750 people including suppliers

Preliminary Design Review scheduled for 1H2014

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E2 Customer Engagement

Event Date

�1st Advisory Board October 2012

�Man Machine Interface June 2013

�Maintenance and Operations Workshop September 2013

� Interior Steering Group October 2013

�2nd Advisory Board October 2013

• Airline Operations and Connectivity Workshops Oct.-December 2013

• Industry Steering Committee January 2014

This information is property of Embraer and cannot be used or reproduced without written permission. >>

E195-E2 EIS | 2019

E190-E2 EIS | 1H 2018

E175-E2 EIS | 2020

E2 Entry into Service

150 Firm Orders

50 Options

100 Purchase Rights

LOIs for 65 Orders

Thank you