Embraer works to adjust production after end of Boeing deal

Brazilian plane maker Embraer stated Sunday (Apr. 26) that, after the end of the $4.2 billion agreement with Boeing, announced on the weekend, it has worked to readjust its production levels and capital expenditures to save resources.

In a statement, the firm added it closed out 2018 with “a solid cash position” and “no significant debt for the coming years.”

“We’re taking additional measures to preserve liquidity and keep out finances solid during these turbulent times,” the company added.

Other measures include stock adjustments, an extension in payment cycles, reduced spending, and strategies to obtain funding, Embraer declared.

The deal between Embraer and Boeing was unveiled nearly two years ago. The companies were in the final phase of closing talks before Boeing took the initiative to end the pact. Boeing should control 80 percent of the commercial aviation division of Embraer, which manufactures planes of up to 150 seats.

Boeing and Embraer had received the approval of antitrust regulators of all required governments, except the European Union, and Embraer spent millions created the business segment Boeing was to take over.

Inappropriate termination

The Brazilian company, the world’s third biggest plane maker, saw the deal as necessary for its long-term survival, as duopoly Boeing-Airbus consolidated its strength.

In a note released Saturday (25), Embraer stated that Boeing terminated “the Global Operation Agreement inappropriately and fabricated false allegations as a pretext to attempt to escape its commitments to carry out the transaction and pay Embraer the purchasing price of $4.2 billion.”

The Brazilian company also said that it will seek to take “the necessary measures” to be refunded for the damages caused as a result of the termination.