Brazil’s government has revealed plans to force Gol and LATAM to acquire Embraer aircraft. It would be a condition for the two airlines to obtain financing from the state development bank BNDES, explained the organization’s president, Aloisio Mercadante.
Among the major Brazilian carriers, only Azul is a planemaker customer, operating 43 E195s and 22 E195-E2s. Gol has a fleet of just Boeing 737 jets while LATAM has the A319 as its smallest aircraft.
According to Mercadante, Gol and LATAM are considering ordering aircraft from Embraer, as the manufacturer itself recently revealed.
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The president of BNDES was at the manufacturer’s headquarters on Friday, in a delegation of Brazilian president Luiz Inácio Lula da Silva, who participated in the announcement of financing 32 E175 jets for American Airlines worth around US$800 million.
The Brazilian development bank has been making loans to Embraer clients such as lessor Azorra as a way of making aircraft exports viable, something trivial in this segment.
Financial restructuring
The pressure from the Lula administration to make Brazilian airlines order planes from Embraer comes amid the financial restructuring of Gol Linhas Aéreas, which in January joined Chapter 11 to renegotiate its debts.
LATAM also went through the process, but managed to settle its debts. The country’s three large transport companies, however, continue to carry large liabilities arising during the Covid-19 pandemic.
