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7th Annual U.S. Analyst
                                            and Investor Meeting
                                                April 11th, 2007




Airline Market Overview

A perspective from
the 30 to 120-seat segment



Frederico Fleury Curado - Embraer
Executive Vice-President, Airline Market
Contents



  Air Transport Industry Review


  50-seat Regional Jet Market


  E-Jets: The 70 to 120-seat Market Evolution


  Embraer Market Forecast
Passenger traffic back and growing

                      Strong passenger demand

                                                                                  RPK Average Annual Growth Rates
                        5.0
                                                 3.5%                                      6.2%                         -0.4%           11.4%                5.8%
                        4.5

                        4.0

                        3.5
Total RPK (Billion)




                        3.0

                        2.5

                        2.0

                        1.5

                        1.0

                        0.5

                        0.0
                                 1991

                                          1992

                                                  1993

                                                           1994

                                                                   1995

                                                                           1996

                                                                                    1997

                                                                                            1998

                                                                                                   1999

                                                                                                          2000

                                                                                                                 2001

                                                                                                                         2002

                                                                                                                                2003

                                                                                                                                       2004

                                                                                                                                              2005

                                                                                                                                                     2006F

                                                                                                                                                              2007F

                                                                                                                                                                      2008F
                      Source: ICAO - Contracting States - Scheduled Airlines
LCC’s still in demand’s driver seat

                           2Q 2000   LCC’s US Domestic Network    2Q 2006




                                             LCC’s Market Share
                                               (Domestic RPM)
                                             2000         19%
                                             2006         34%
                                            2010F         39%



                   • LCCs with increased market share and pricing power.
            • Network Carriers focused more on international markets and
           using Regional partners to improve domestic network efficiency.
Source: BACK and Embraer
Strong effort to reduce costs

Operating Costs excluding fuel decreased

                              14
                                                                      17 %                   12.25
                                                         Total Cost: +
                              12
                                      10.49
            CASM (US¢/ASM)




                              10
                                                      Total Cost (excl. Fuel): -1%
                                               8.99                                  8.89
                                8

                                6

                                4
                                2

                                0
                                     3Q2000                   3Q06 vs 3Q00                  3Q2006
                             Fuel     1.50    (14%)                    +124%                 3.36    (27%)

                             Other    5.42    (52%)                    +10%                  5.99    (49%)

                             Labor    3.57    (34%)                    -19%                  2.90    (24%)



Source: ATA (Airline Cost Index)
Fuel Price

      Lack of spare oil production capacity remains                                                                                        high price trend

                                  Jet Fuel Price by Region                                                                  Jet Fuel Price Forecast (EIA)
                                  2.25                                                                                      2.25
                                              New York
                                  2.00        Rotterdam                                                                     2.00
Jet Fuel Price (US$ per Gallon)




                                                                                                                                    1.99



                                                                                                                                              1.94
                                              Singapore




                                                                                                                                                      1.93
                                                                                                Jet Fuel (US$ per Gallon)
                                  1.75        China                                                                         1.75




                                                                                                                                                              1.67



                                                                                                                                                                      1.64
                                  1.50                                                                                      1.50

                                  1.25                                                                                      1.25

                                  1.00                                                                                      1.00

                                  0.75                                                                                      0.75

                                  0.50                                                                                      0.50
                                      2000   2001     2002   2003   2004   2005   2006   2007                                      2006      2007    2008    2009    2010




                                                       For coming years oil barrel is expected to stay at
                                                       US$52-62 level and jet fuel at US$1.64-1.94/gallon.
  Source: EIA - Energy Industry Administration (Feb/07)
Revenue environment is improving

World nominal yields improved in the last 5 years
                         9.25
                                   Nominal
                         9.00
                                   Real (Y2001; adj. for US inflation)
                         8.75
World Yield (US Cents)




                         8.50

                         8.25

                         8.00

                         7.75

                         7.50

                         7.25
                                2001         2002         2003           2004            2005    2006   2007F   2008F


                                  Nominal yields: 10% increase in the last five years
                                             Real yields: 3% lower than 2001 values
 Source: ICAO (Contracting States – Passenger, Scheduled Airlines), Global Insight and Embraer
Profitability ahead

Positive results projected for 2007

          North America
          -10 -6.7 -3.7 0.2
                                                     Europe
                                                1.1 1.6 1.8 1.5                                                                    World
                                                                                                                            -5.6 -3.2 -0.5 2.5

                                                2004 2005 2006F 2007F




                                                                        Middle East
                                                                      0.2 0.2 0.1 0.1
         2004 2005 2006F 2007F
                                                                    2004 2005 2006F 2007F
                                                                                             Asia Pacific
                                                                                                                            2004 2005 2006F 2007F
               Latin America                                                                3.4 2.1 1.7 1.2
                                                      Africa
               0.1 -0.1 0.1 0.1
                                                -0.3 -0.4 -0.5 -0.5
               2004 2005 2006F 2007F

                                                2004 2005 2006F 2007F
                                                                                            2004 2005 2006F 2007F



                                                                                                                                Values in US$ Billion
Source: IATA Economics Dec/06 (ICAO 2004-2005 and IATA Forecast 2006-2007)                  US net losses includes $6.1bn restructuring costs in 2006
Air transport industry major drivers


                   Increased Competition                 Weak Revenue Environment
                 Need for differentiation in services      Improved productivity and efficiency



  New Passenger Profile                                                            Liberalization
       Different Set of Values
                                                                              Opportunities for new entrants
(pricing, comfort, more direct flights)
                                           Air Transport
                                             Industry
   Old & Inefficient Aircraft                                              Emissions Regulations
Pressure on Fuel & Maintenance Costs                                      May anticipate A/C Replacement



                                          Demand/Capacity Match
                                          Better match to avoid empty seats
A quick look at the W/W fleet profile

Scheduled Airlines, All Pax Configuration and Active in Service

18,204 aircraft                                                                                                                                                                   Age (years)

                                                                                                                                                                                      > 30
                             4,000
                                                                                                                                                                                      26-30
                             3,500                                                                           3395
                                                                                                                            3306
                                                                                                                                                                                      21-25
Number of Aircraft (Units)




                             3,000                                                                                                                                                    16-20

                             2,500                                                                                                                                                    11-15

                                                                      2027                                                                                                            6-10
                             2,000
                                               1741                                                                                                                                   0-5
                                                                                               1548
                             1,500                                                                                                                       1378
                                                                                                                                          1067
                                     968                                           862                                                                                  973
                             1,000

                                                           414                                                                                                                          525
                              500

                                0
                                     TP < 30



                                                TP 30-60



                                                           TP 61-90



                                                                       Jet 30-60



                                                                                   Jet 61-90



                                                                                                Jet 91-120



                                                                                                              Jet 121-145



                                                                                                                            Jet 146-175



                                                                                                                                           Jet 176-210



                                                                                                                                                          Jet 211-300



                                                                                                                                                                        Jet 301-400



                                                                                                                                                                                        Jet >400
Source: BACK (Dec/06)
ERJ 145 Family
ERJ 145 Family



                        37 Seats



                        44 Seats



                        50 Seats




                         50 Seats
                 (2,000 nm range)
ERJ 145 Family Orderbook




                 Firm                        Firm
                         Options Deliveries Backlog
                Orders

     ERJ 135     108        1       108         -

     ERJ 140      74        -       74          -

     ERJ 145     732       132      679        53

      Total      914       133      861        53
                                            (as of December 31st, 2006)
RJ´s importance to US hub-and-spoke system

Hub system extremely dependent of RJs

                                     % of RJ50 passengers through Connections
                 100%


                   80%


                   60%


                   40%


                   20%


                    0%
                                              R
                                              H
                                   IAD




                                             W
                           D




                                              L
                                             A




                                             N
                          G




                                             A
                                             W




                                             P
                                             L




                                             C




                                           PIT
                                             E
                                             L
                                             M
                                             T




                                          PH
                                         EW
                                           IA
                                          AT
                        OR




                                          ST
                                         LG
                                          CL




                                          CL
                                         DE




                                         DC
                                         MS


                                          SL
                        CV




                                         DF




                                         DT




                                         ME
              RJ50: 3 connecting passengers for each local passenger
Source: Back (T100 and OD1A, RJ50: ERJ Family, CRJ-100/200 and 328Jet)
50-seat Regional Jet Operation - 2006
 Single provider routes can benefit from higher yields




                                  USA                                                                     Europe
               Total RJ: 2,856 Routes                                                           Total RJ: 1,386 Routes

                 RJ as a Single Service Provider:                                                RJ as a Single Service Provider:
                          1,114 Routes                                                                     436 Routes
                       (39% of total RJ routes)                                                        (31% of total RJ routes)

Source: Back (Jan/07: ERJ135/140/145, CRJ100/200/440, 328Jet ; more than one flight per week)
Fleet Age Profile (30-60 seats)

           2,018 Jets (average age: 7 years)



                     1,400
                                                                                                   Number           Average
                                                                            Region                    of      %       Age
                     1,200                                                                         Aircraft         (years)
                                                                            USA & Canada            1,421     70%      4
                     1,000
Number of Aircraft




                                                                            Latin America            13       1%       3
                      800                                                   Europe                   297      15%      6

                                                                            Russia & CIS             187      9%      31
                      600
                                                                            Africa & Middle East     15       1%      12
                      400                                                   Asia Pacific             21       1%       5

                                                                            China                    64       3%       4
                      200
                                                                            World                   2,018              7
                        0
                             0-5   6-10 11-15 16-20 21-25 26-30 31-35 >35

                                             Age (Years)


Source: Back (Oct/06)
RJ 50 Market Opportunities - China
Most of the routes have low demand density and low frequencies.

                           500        383 markets         152 (20%)               68 (9%)



                           400
                                       51% of
                                     total markets
 Daily Passenger Traffic




                                     have less than
                           300          one daily
                                     frequency and
                                     less than 135
                           200          pax/day



                           100

                                                                                                 Number of domestic markets: 755
                             0
                                 0                    1                  2                   3               4                5
                                                                              Daily Frequency
Source: China Airline Traffic Statistics 2005 (Markets with at least one weekly frequency)
China - an unbalanced jet fleet

30-120 seat jets represent only 12% of China jet fleet (30-210 seats), while
it is 43% in US and 35% in Europe


                                       4,829 aircraft                     826           2,612
                                100%



                                80%
     % of Jet Fleet (J30-210)




                                           58%                                                        Seat Segment
                                                                                        65%
                                60%                                                                      J121-210
                                                                          89%

                                                                                                         J61-120
                                40%
                                           15%
                                                                                                         J30-60
                                                                                        24%
                                20%                 43%                                         35%
                                           28%
                                                                         4%
                                                                          8%
                                                                                 12%    11%
                                 0%
                                          USA                            China         Europe


Source: BACK FleetPC (Jun/06 ; active in service ; scheduled airlines)
China - ERJ 145 and 328Jet Routes



                                   29 328Jet
    6 ERJ145
                               Backlog: 50 ERJ145




  4 ERJ145
  Backlog: 6




                                                    ERJ145
     5 ERJ145
                                                    328Jet

Source: CAAC (2005), Embraer
RJ 50 Market Opportunities - Russia/CIS

        Old fleet replacement need: 521 aircraft          Improved fuel consumption
                                                          Lower Operating Costs
                                                          Increased Productivity




                     200
Number of Aircraft




                     150           50 seats    30 seats
                                   Avg. Age    Avg. Age         76 seats
                                   35 years    32 years         Avg. Age

                     100                                        29 years
                                    186         189
                                   An-24       Yak-40            146
                      50                                        Tu-134


                       0
                                 Turboprop    Jet 30-60       Jet 61-90
         Source: BACK (Oct/06)
RJ 50s Future Market


• Market entered a mature phase in the US and Europe


• RJ50s will remain the backbone of US hub feeding system


• New market opportunities (long and thin) in the US and EU


• Potential in China, Russia and other markets


• Secondary market developing
E-Jets

   Helping airlines
to improve efficiency
E-Jets Family

                                  EMBRAER 170/175
 EMBRAER 170
 • 70 to 80 seats
 • 2,000 nm Range
 • Certification: February 2004

 EMBRAER 175
 • 78 to 88 seats
 • 1,900 nm Range
 • Certification: December 2004

                                  EMBRAER 190/195
 EMBRAER 190
 • 98 to 114 seats
 • 2,300 nm Range
 • Certification: August 2005

 EMBRAER 195
 • 108 to 122 seats
 • 2,100 nm Range
 • Certification: June 2006
The E-Jets Family - Main Applications



   Natural evolution for existing 50-seat markets


   Right-sizing of low load-factor narrow-body flights
     Capacity, range & seamless service
     Enhancing services by increasing frequencies


   New market opportunities – low risk development
     Medium density and long/thin markets


   Replacement of old & inefficient jets
Market Opportunities – Right-sizing

US Domestic (100-160 seat Jet - 12 months ending Sep/2006)
                                                                          r
                                600,000                             c   to                                                      100%
                                                               d Fa         r
                                                          oa            ate                   te   r
                                                     .L                e                   ea                         try
                                                 Avg            7   6-s                00
                                                                                         -s                      Indus
                                480,000                                              1                                          80%




                                                                                                                                       Average Load Factor
               Annual Flights




                                360,000                                                                                         60%



                                240,000                                                                                         40%



                                120,000                                                                                         20%



                                     0                                                                                          0%




                                                                                                                            0
                                             0




                                                                                                             0



                                                                                                                  0
                                                    50



                                                                     60



                                                                                70



                                                                                        80



                                                                                                       90




                                                                                                                          2
                                          <5




                                                                                                            10



                                                                                                                 11



                                                                                                                       >1
                                                                                 Pax per Departure


    • 851 thousand flights (40% of total) carried less than 100 passengers onboard

Source: BACK
Air Canada Strategic Review Presentation (September 27, 2004)




                                                               Y
                                                            COP
Air Canada - Changing the Game Presentation (Dec/2006)




                                                            Y
                                                         COP
Delta Flight Plan Presentation (Mar/2007)




                                               Y
                                            COP
US Scope Clauses - Jun/2000

                                                                                                          Labor
Seats     40             50             60              70            80             90           100
                                                                                                         Contract
                                                                                                        Amendable
                                                                                                           Year
                      30 units                                 Not Allowed
        Unlimited   45-55 seats              (Grandfathered rights 36 Avro RJ85 up to 69 seats)           2003



                Unlimited                                        Not Allowed                              2003



        Unlimited             Up to 67 units                               Not Allowed                    2002



           Unlimited             Up to 75 units                            Not Allowed                   2000


                                                          Not Allowed
        Up to 65 units                                                                                   2000
                                             (Grandfathered rights 18 AirWis BAe 146)


               Up to 35 units 50 seats and
                    35 units 69 seats                                      Not Allowed                   2003
US Scope Clauses - Jun/2006

                                                                                                              Labor
Seats   40                50               60                   70         80              90         100
                                                                                                             Contract
                                                                                                            Amendable
                                                                                                               Year
         Unlimited                     Up to 90 units                              Not Allowed
                                                                                                              2012



         Unlimited                                                 Not Allowed                                2009


        “Unlimited”
             (Up to 110% AA         Up to 50 units                               Not Allowed                  2008
              narrow body)


                                      Up to 200 units
         Unlimited             (30 units 71-76 seats + 3 units for each            Not Allowed               2010
                                          mainline aircraft increase)



                 “Unlimited” up to 70 seats                                      Not Allowed                 2010


                                                                          Up to 93 units
                      Unlimited up to 78 seats                               (86 seats)
                                                                                            Not Allowed      2010
Market Opportunities - Replacement

                     World Fleet Age Profile (61-120 seats): 2,454 jets with 15 years average age


                      800
                                                                                                       Avg.
                                                      30% of 61-120 fleet       Region       # Acft.
                      700                                                                              Age
                                                      (735 acft) with more   USA, Canada &
                      600                                                                     846       10
                                                                                Caribbean
Number of Aircraft




                                                            than 20 years
                      500                                                    Latin America    285       23

                      400
                                                                                Europe        617       11
                                                                              Russia & CIS    231       23
                      300
                                                                                 Africa       148       22
                      200                                                     Middle East      48       16

                      100                                                     Asia Pacific    241       19
                                                                                 China         38       8
                       0
                            0-5     6-10 11-15 16-20 21-25 26-30 31-35 >35      World        2,454     15
                                              Age (Years)


                 Source: BACK (Oct/06)
Maximizing the Revenue in the Profit Equation

Revenue strengths of smaller airplanes                        Revenues
                                                   Yields /
                                                    Fares

                  better market share

   More flights   . . . with business passengers

                  market stimulation

   More direct
                  better fares and yields
     flights

  New markets     better yields / more revenue

   Capacity
                  better yields
  Management
E-Jets Joint Certification means Flexibility

• Same Type Design for ANAC, FAA and EASA




                                                             FAA                  EASA

                                               ANAC              FAA             EASA

                              EMBRAER 170   February 2004            February 2004


                              EMBRAER 175   December 2004    August 2006       January 2005


                              EMBRAER 190    August 2005    September, 2005     June 2006


                              EMBRAER 195     June 2006     2nd Quarter 2007    July 2006




                   • Market swap flexibility
                  • Increased residual value
E-Jets Commonality


Training                70% of the potential                                    Spare Parts                      30% of the potential
                        benefits                                                                                 benefits
same cockpit, common systems and fly-                                                               E170
by-wire technology mean maximum
training commonality within the family                                                                                        100%
 EMBRA                                                                                              E175
                      170            175             190            195
      ER
     170             -------       A/A/A            A/A/A          A/A/A                                           86%
     175            A/A/A           -------         A/A/A          A/A/A
                                                                                                    E190
     190            A/A/A          A/A/A            -------        A/A/A
                                                                                                                              100%
     195            A/A/A          A/A/A           A/A/A            -------
                                                                                                    E195
Training Qualification Differences : According to FAA AC 120- 53, grades
                                                                                Based on the aircraft RSPL (Recommended Spare Parts List)
range from A (best) to E (worst) in 3 categories: Training Differences, Check
                                                                                Note: Airframe and Ground Servicing Equipment only (Engines are not included).
Differences and Recurrent Training




                 • E-Jets have the maximum training commonality (A/A/A)
          • E-Jets offer an outstanding parts commonality (86% to 100%)
The Comfort Factor

E-Jets: Narrowbody airplane comfort in convenient sizes

      CRJ700/900              EMBRAER 170/190                    A318/320
        17.3”                        18.25”                             18.0”




                 16”                           19.75”                      19”

                                   E170/190 advantages:
0.95” (2.4cm) wider seats              Widest seats    0.25” (0.6 cm) wider seats
3.75” (9.5cm) wider aisle (+23%)       Widest aisles     0.75” (1.9 cm) wider aisle

16% more volume per seat             No middle seats     Equal volume per seat

“Passengers love this aircraft for its spacious interior design and in particular the
absence of a middle seat” Bryan Bedford, CEO Republic Airways (Jul/06)

“The comfort of the E175 aircraft is important to our customers and the economics of
the aircraft make good business sense.”
Scott Kirby, US Airways EVP Sales and Marketing (Jul/06)
The Trip Cost Factor

  E-Jets: Lower trip costs than comparable airplanes
                   8000                                                                                                       7563
                                                                              - 20%
                              - 32%
                   7000
                                                                                                      6310
                                                                               6058
                   6000                                                                                                                            US Domestic
                                                       5368
                                5135
                                                                                                                                                  Network Airline -
    US$ per Trip




                   5000
                                                                                                                                                    800 sm trip

                   4000

                   3000                                                                                                                           Airplane Variable
                                                                                                                                                  plus Ownership
                   2000                                                                                                                            Costs per Trip

                   1000

                      0
                               E170                   E175                    E190                   E195                 A319 /
                                                                                                                         B737-700
2-class seating:                  70                     78                      94                     104                    124
  Costs exclude: revenue related costs and system (overhead) costs
  Costs include: variable: fuel, crew, maintenance, landing fees, handling fees ; ownership: lease cost, hull insurance, spares inventory costs
Air Canada - Changing the Game Presentation (Dec/2006)




                                                            Y
                                                         COP
E-Jets Family Orderbook




                    Firm                               Firm
                            Options   Deliveries
                   Orders                             Backlog
     EMBRAER 170    157      133         128               29
     EMBRAER 175    99       136         25                74
     EMBRAER 190    317      248         53               264
     EMBRAER 195    46        51          3                43
        Total       619      568         209             410
                                                   (as of December 31st, 2006)
E-Jets Customer Base Evolution

Customers                        1      2      3      4      9        13        18     33
                          700
                                                                                       619
                          600
Accumulated Firm Orders




                          500                                                   440

                          400                                         343

                          300                               245

                          200
                                       110    112    118
                          100   60


                           0
                                1999   2000   2001   2002   2003     2004       2005   2006
                                                                   Deliveries
    Source: Embraer
E-Jets Worldwide Distribution


    Customers             Asia Pacific /
                                               Firm Orders
                          China

           14%            Middle East /                 13%
   24%                    Africa                              5%

                 21%      Europe
                                                60%            16%
  17%
          24%                                                 6%
                          Latin America


                          North America




• growing and diversified customer-base across five continents
• increased presence in emerging markets with established carriers
E-Jets Family - Efficiency to all Business Models

                          Regional                              Network   Low Cost




                                                                          Charter



 Source: Embraer (Jan/07 ; Sirte Oil and GECAS not presented)
E-Jets Deployment - USA and Canada


                                                                        Dec/06              Deliveries     Backlog
                                                                                                15 E175
                                                                                                           27 E190
                                                                                                18 E190

                                                                                                23 E190    78 E190


                                                                                                           36 E175


                                                                                                2 E190     55 E190


                                                                                                16 E170


                                                                                                4 E170 *

       Natural Growth            Right-sizing   New Routes
                                                                                                28 E170
             40%                        42%           18%

0%           20%           40%          60%     80%         100%                                28 E170    30 E175

                        % of Routes (4Q06)                              E-Jets                   134         226
     Source: BACK (4Q06), Embraer                                  * to be operated in Mar/07
Number of Flights




                                                       2,000
                                                               4,000
                                                                              6,000
                                                                                               8,000




                                                   0
                                                                                                             10,000
                                                                                                                               12,000
                                            <1
                                        10 00




Source: BACK (4Q06)
                                          1-
                                             2
                                        20 00
                                          1-
                                             3
                                        30 00
                                          1-
                                             4
                                        40 00
                                          1-
                                             5
                                        50 00
                                          1-
                                             6
                                        60 00
                                          1-
                                             7
                                        70 00
                                          1-
                                             8
                                        80 00
                                          1-
                                       90 900
                                         1-
                                      10 100
                                        01 0
                                          -
                                      11 110
                                        01 0
                                          -




                      Distance (nm)
                                      12 120
                                        01 0
                                          -
                                      13 130
                                        01 0
                                          -
                                      14 140
                                        01 0
                                          -
                                      15 150
                                                                E-Jets




                                        01 0
                                          -
                                      16 160
                                                                                                                                                                  E-Jets Operational Profile - USA and Canada




                                        01 0
                                          -
                                      17 170
                                        01 0
                                          -1
                                             80
                                               0
                                                                548 nm
                                                                         474 nm
                                                                                      549 nm
                                                                                                 440 nm
                                                                                                          663 nm
                                                                                                                      669 nm
                                                                                                                                    Average Stage Length (4Q06)
E-Jets Deployment - USA and Canada

Efficiency and flexibility for long and short haul markets


                                            Airline      Longest Route              Shortest Route

                                                         Montreal-Calgary            Ottawa-Toronto
                                                      1,866 sm - 4:18 (2 Daily)   225 sm - 1:00 (2 Daily)


                                                         Dallas-New York            Atlanta-Charlotte
                                                      1,377 sm - 3:46 (1 Daily)   227 sm - 1:14 (1 Daily)


                                                         Austin-New York            Boston-New York
                                                      1,515 sm - 3:30 (1 Daily)   187 sm - 1:16 (7 Daily)


                                                          Denver-Toronto           Washington-Norfork
                                                      1,310 sm - 3:16 (1 Daily)   175 sm - 1:00 (2 Daily)


                                                       Houston-Philadelphia       KeyWest-Ft.Lauderdale
                                                      1,323 sm - 3:06 (1 Daily)    145 sm - 0:49 (1 Daily)




Source: BACK (4Q06)
E175/190 at Air Canada

                                       LaGuardia – Montreal   Chicago – Toronto
                                       2005        2007       2005       2007
                                Seats* 870         508        480        485
                          6:00                     E175
                                          A319                           E175
                          8:00                                A319
                                          A319     E175                  E175
                        10:00                                 A319
                                                   E175
                                          A319
                        12:00
                                                    CRJ                  E175
                        14:00
                                          A319     E175                  E175
                        16:00                                 A319
                                          A319     E175
                        18:00                                 A319       E175
                        20:00             A319     E190                  A319
                        22:00

           E-Jets Right-sizing at Air Canada:
           • 76% of total E175/190 routes
           • 5 routes complementing A319 and 7 routes complementing A320
           • 11 routes replacing A319 and 2 routes replacing A320

Source: BACK (4Q06)   *4th Wednesday of January
E170 at US Airways

                                  Philadelphia – Charleston Washington – Portland ME
                                       2005       2007       2005      2007
                                Seats* 100        190        150       260
                          6:00
                          8:00             CRJ
                                                  E170       CRJ
                        10:00                                          E170
                        12:00
                                                                       CRJ
                        14:00                     CRJ
                                                             CRJ       E170
                        16:00
                        18:00              ERJ
                        20:00                     E170
                                                             CRJ       E170
                        22:00

E-Jets Natural Growth at US Airways:
• 56% of E170 routes
• 17 routes complementing CRJ-100/200 and 4 routes complementing ERJ 145
• 5 routes replacing CRJ-100/200 and 1 route replacing ERJ 145

Source: BACK (4Q06)   *4th Wednesday of January
E-Jets Deployment - Europe


                                                                  Dec/06   Deliveries        Backlog

                                                                             6 E170


                                                                             2 E170

                                                                            10 E170
                                                                                               9 E190
                                                                             1 E190

                                                                             2 E195           12 E195

                                                                            10 E170
                                                                             6 E175

                                                                             1 E190            5 E190

                                                                                              15 E170
     Natural Growth          Right-sizing         New Routes                                  15 E195

          41%                               53%           3%      E-Jets       38                56

0%       20%           40%          60%           80%      100%
                      % of Routes (4Q06)                                    Source: BACK (4Q06), Embraer
E170/190 at Finnair

                               Helsinki – Copenhagen     Hamburg – Helsinki
                                       2005       2007      2005   2007
                                Seats* 528         559       252   228
                          6:00
                          8:00            A319    A319

                        10:00             A319    E190             E170
                                                           A319
                        12:00
                        14:00
                                          A319    E170             E170
                        16:00
                        18:00             A319    A321
                                                           A319    E170
                        20:00                     E170
                        22:00

               E-Jets Right-sizing at Finnair:
               • 74% of total E-Jets routes
               • 44 routes complementing A319/320s
               • 8 routes replacing A319/320s and 6 routes replacing MD-80s

Source: BACK (4Q06)   *4th Wednesday of January
E-Jets Deployment - Middle East & Africa


                                                             Dec/06   Deliveries          Backlog

                                                                         14 E170            1 E170


                                                                         1 E195             6 E195


                                                                                            6 E170


                                                                                            3 E170


                                                                                            2 E170

                                                             E-Jets         15                18

       Natural Growth         Right-sizing   New Routes
  5%                          86%                   9%

 0%        20%          40%          60%     80%      100%

                    % of Routes (Jan/07)                              Source: BACK (Jan/07), Embraer
E-Jets Deployment - Asia Pacific & China

                                  Dec/06   Deliveries   Backlog

                                                        50 E190

                                                        3 E170
                                                        11 E190

                                                         3 E190
                                                         5 E195

                                             2 E170
                                             3 E175

                                                         1 E170


                                                         1 E170


                                  E-Jets       5          74




Source: BACK (1Q07), Embraer
E-Jets Deployment - Latin America




         Dec/06   Deliveries   Backlog

                    1 E190      4 E190


                    1 E175      1 E190


                    6 E190      9 E190


                    2 E170

                    2 E170
                    1 E190

         E-Jets      13          14


Source: Embraer
E-Jets Family - EIS Statistics

                            E170/175                                                        E190/195
Operators                                           13             Operators                                        10
Aircraft in Service                                156             Aircraft in Service                              67
Flight Hours                                     582,594           Flight Hours                                   94,725
Flight Cycles                                    403,422           Flight Cycles                                  58,740
Fleet Leaders                                                      Fleet Leaders
   Flight Ho urs (Republic S/N 16)                 7,624               Flight Ho urs (JetB lue S/N 8)              3,072
  Flight Cycles (Republic S/N 13)                  5,243              Flight Cycles (JetB lue S/N 8)               2,164

                                                          E170/190 Family
                                          Operators*                            21
                                          Aircraft in Service                  223
                                          Flight Hours                       677,319
                                          Flight Cycles                      462,162




Source: Airlines (as of Mar 26th, 2007)                         (*) Air Canada operates E175 and E190 and Tame operates E170 and E190
E170/190 at Virgin Blue

                                 6 Embraer 170
                                 14 Embraer 190




       “People refer to it as a regional jet, but it is not a regional jet, it is the
       first airliner that has bridged that gap between NBs and RJs ...
       It’s a wonderful aeroplane for being able to pick up some markets we fly
       today that we’re not doing particularly well on.”
       “It has the mission capabilities to be able to fly the length and breadth
       of our country, it has the capabilities to fly into the Pacific to where we
       fly today with our 737s. But we’re able to do it at a lower trip cost.”
                                     Brett Godfrey, Virgin Blue CEO   Australian Aviation, Jan/Feb 2007
E190 at Hainan



                  50 ERJ 145 plus 50 EMBRAER 190 order




 “The acquisition of ERJ-145s and EMBRAER 190s represents an
 important validation of our strategy of providing more flexible flights
 to match the rapidly increasing demand of the domestic market in
 China”    Chen Feng – Chairman Hainan Airlines   ATI News Aug/06
E190 at Flybaboo


                      Embraer 190: 5 firm + 5 options




       “Comfort is one of our constant concerns and I’m truly convinced that,
       with the EMBRAER 190, we will be offering the highest quality of comfort
       and service to our clients.”
       “We selected the E190 for its comfort and its performance. It has four-hour
       flight endurance, enabling it to reach destinations with a range of more
       than 3,000 km, along with capability to take-off and land at small airports.”
       Julian Cook, Flybaboo Founder and Managing Director   Source: ATI News, Embraer, Feb 2007
2007-2026 Embraer Market Outlook
                                                    4th. Edition




  A LONG-TERM VIEW
 OF THE 30 TO 120-SEAT
COMMERCIAL JET MARKET
Projected Traffic and Economic Growth

Growth by Region (2007-2026)

  USA, Canada & Caribbean
                                                                                              RPK
                    Latin America                                                             GDP
                            Europe

                                  CIS

                               Africa

                       Middle East

                       Asia Pacific

                              China

                              World

                                        0%    1%   2%      3%      4%      5%       6%   7%         8%

                                                        Average Annual Growth (%)

                        Projected world GDP growth around 3% in the next twenty years
                         will sustain nearly 5% annual increase in air transport demand.

Source: Global Insight and Embraer (Oct/06)
Regional Trends

                                                                 Europe                               Russia & CIS
                                                                                              • Recovering Economy and Yield
                                             • Environment rules may impact air
                                                                                                Environment
                                               transport growth
                                                                                              • Tax Barriers to Western Aircraft
                                             • Increased Competition (LCC Expansion)
     USA, Canada & Caribbean                 • High Speed Train Competition
                                                                                              • Ageing Fleet
                                             • Right-Sizing and Direct Replacement
 •   Airline Consolidation
                                               Opportunities
 •   Increased Competition (LCC Expansion)
 •   Scope Clause Relaxation
 •   Right-Sizing Opportunities                                                                             China
                                                             Middle East                  •   New Policies for Regional Aviation
                                                                                          •   Increased Competition (Start-ups)
                                             •   Regional Network Under Development
                                                                                          •   Pilot Shortage
                                             •   Slow Liberalization Trend
                                                                                          •   Concentration on Large Aircraft
                                             •   High Comfort Standards
                                                                                          •   Right-sizing opportunities
                                             •   Travel Demand Growing Above World
                                                 Level
             Latin America
• Increased Competition (LCC Expansion)
• Ageing Fleet                                                                                          Asia Pacific
• Right-Sizing and Direct Replacement                                                         • Trends Towards Liberalization
                                                                  Africa
  Opportunities                                                                               • Increased Competition (Start-ups)
• Trend Towards Liberalization                   •   Government Owned Flag Carriers           • Concentration on Large Aircraft
                                                 •   Ageing Fleets (Used Aircraft)            • Infrastructure Constraints to
                                                 •   Very Fragmented Market                     growth
                                                 •   Liberalization on some countries /       • Pilot Shortage
                                                     regions
Embraer Market Forecast (2007-2026)


                  Worldwide Jet Deliveries



     Segment    2007 - 2016   2017 - 2026    2007 - 2026

      30 - 60      300           1,100         1,400

      61 - 90     1,100          1,500         2,600

     91 - 120     1,650          1,850         3,500
     30 - 120     3,050          4,450         7,500
Embraer Market Forecast (2007-2026)

Projected Deliveries (30-120 seats): 7,500 Jets



                                            Russia & CIS
          USA, Canada                             505
          & Caribbean           Europe            7%
              3,850              1,290
               51%                17%                   China
                                        Middle          630
                                         East            9%
                                 Africa 230
             Latin                130 3%
            America               2%                           Asia
               480                                            Pacific
               6%
                                                                385
                                                                5%
Thank you


78 airlines. 45 countries. 1 manufacturer. EMBRAER

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2007 - 7th Annual U.S. Analyst Airline Market Overview Commecial Aviation

  • 1. 7th Annual U.S. Analyst and Investor Meeting April 11th, 2007 Airline Market Overview A perspective from the 30 to 120-seat segment Frederico Fleury Curado - Embraer Executive Vice-President, Airline Market
  • 2. Contents Air Transport Industry Review 50-seat Regional Jet Market E-Jets: The 70 to 120-seat Market Evolution Embraer Market Forecast
  • 3. Passenger traffic back and growing Strong passenger demand RPK Average Annual Growth Rates 5.0 3.5% 6.2% -0.4% 11.4% 5.8% 4.5 4.0 3.5 Total RPK (Billion) 3.0 2.5 2.0 1.5 1.0 0.5 0.0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006F 2007F 2008F Source: ICAO - Contracting States - Scheduled Airlines
  • 4. LCC’s still in demand’s driver seat 2Q 2000 LCC’s US Domestic Network 2Q 2006 LCC’s Market Share (Domestic RPM) 2000 19% 2006 34% 2010F 39% • LCCs with increased market share and pricing power. • Network Carriers focused more on international markets and using Regional partners to improve domestic network efficiency. Source: BACK and Embraer
  • 5. Strong effort to reduce costs Operating Costs excluding fuel decreased 14 17 % 12.25 Total Cost: + 12 10.49 CASM (US¢/ASM) 10 Total Cost (excl. Fuel): -1% 8.99 8.89 8 6 4 2 0 3Q2000 3Q06 vs 3Q00 3Q2006 Fuel 1.50 (14%) +124% 3.36 (27%) Other 5.42 (52%) +10% 5.99 (49%) Labor 3.57 (34%) -19% 2.90 (24%) Source: ATA (Airline Cost Index)
  • 6. Fuel Price Lack of spare oil production capacity remains high price trend Jet Fuel Price by Region Jet Fuel Price Forecast (EIA) 2.25 2.25 New York 2.00 Rotterdam 2.00 Jet Fuel Price (US$ per Gallon) 1.99 1.94 Singapore 1.93 Jet Fuel (US$ per Gallon) 1.75 China 1.75 1.67 1.64 1.50 1.50 1.25 1.25 1.00 1.00 0.75 0.75 0.50 0.50 2000 2001 2002 2003 2004 2005 2006 2007 2006 2007 2008 2009 2010 For coming years oil barrel is expected to stay at US$52-62 level and jet fuel at US$1.64-1.94/gallon. Source: EIA - Energy Industry Administration (Feb/07)
  • 7. Revenue environment is improving World nominal yields improved in the last 5 years 9.25 Nominal 9.00 Real (Y2001; adj. for US inflation) 8.75 World Yield (US Cents) 8.50 8.25 8.00 7.75 7.50 7.25 2001 2002 2003 2004 2005 2006 2007F 2008F Nominal yields: 10% increase in the last five years Real yields: 3% lower than 2001 values Source: ICAO (Contracting States – Passenger, Scheduled Airlines), Global Insight and Embraer
  • 8. Profitability ahead Positive results projected for 2007 North America -10 -6.7 -3.7 0.2 Europe 1.1 1.6 1.8 1.5 World -5.6 -3.2 -0.5 2.5 2004 2005 2006F 2007F Middle East 0.2 0.2 0.1 0.1 2004 2005 2006F 2007F 2004 2005 2006F 2007F Asia Pacific 2004 2005 2006F 2007F Latin America 3.4 2.1 1.7 1.2 Africa 0.1 -0.1 0.1 0.1 -0.3 -0.4 -0.5 -0.5 2004 2005 2006F 2007F 2004 2005 2006F 2007F 2004 2005 2006F 2007F Values in US$ Billion Source: IATA Economics Dec/06 (ICAO 2004-2005 and IATA Forecast 2006-2007) US net losses includes $6.1bn restructuring costs in 2006
  • 9. Air transport industry major drivers Increased Competition Weak Revenue Environment Need for differentiation in services Improved productivity and efficiency New Passenger Profile Liberalization Different Set of Values Opportunities for new entrants (pricing, comfort, more direct flights) Air Transport Industry Old & Inefficient Aircraft Emissions Regulations Pressure on Fuel & Maintenance Costs May anticipate A/C Replacement Demand/Capacity Match Better match to avoid empty seats
  • 10. A quick look at the W/W fleet profile Scheduled Airlines, All Pax Configuration and Active in Service 18,204 aircraft Age (years) > 30 4,000 26-30 3,500 3395 3306 21-25 Number of Aircraft (Units) 3,000 16-20 2,500 11-15 2027 6-10 2,000 1741 0-5 1548 1,500 1378 1067 968 862 973 1,000 414 525 500 0 TP < 30 TP 30-60 TP 61-90 Jet 30-60 Jet 61-90 Jet 91-120 Jet 121-145 Jet 146-175 Jet 176-210 Jet 211-300 Jet 301-400 Jet >400 Source: BACK (Dec/06)
  • 12. ERJ 145 Family 37 Seats 44 Seats 50 Seats 50 Seats (2,000 nm range)
  • 13. ERJ 145 Family Orderbook Firm Firm Options Deliveries Backlog Orders ERJ 135 108 1 108 - ERJ 140 74 - 74 - ERJ 145 732 132 679 53 Total 914 133 861 53 (as of December 31st, 2006)
  • 14. RJ´s importance to US hub-and-spoke system Hub system extremely dependent of RJs % of RJ50 passengers through Connections 100% 80% 60% 40% 20% 0% R H IAD W D L A N G A W P L C PIT E L M T PH EW IA AT OR ST LG CL CL DE DC MS SL CV DF DT ME RJ50: 3 connecting passengers for each local passenger Source: Back (T100 and OD1A, RJ50: ERJ Family, CRJ-100/200 and 328Jet)
  • 15. 50-seat Regional Jet Operation - 2006 Single provider routes can benefit from higher yields USA Europe Total RJ: 2,856 Routes Total RJ: 1,386 Routes RJ as a Single Service Provider: RJ as a Single Service Provider: 1,114 Routes 436 Routes (39% of total RJ routes) (31% of total RJ routes) Source: Back (Jan/07: ERJ135/140/145, CRJ100/200/440, 328Jet ; more than one flight per week)
  • 16. Fleet Age Profile (30-60 seats) 2,018 Jets (average age: 7 years) 1,400 Number Average Region of % Age 1,200 Aircraft (years) USA & Canada 1,421 70% 4 1,000 Number of Aircraft Latin America 13 1% 3 800 Europe 297 15% 6 Russia & CIS 187 9% 31 600 Africa & Middle East 15 1% 12 400 Asia Pacific 21 1% 5 China 64 3% 4 200 World 2,018 7 0 0-5 6-10 11-15 16-20 21-25 26-30 31-35 >35 Age (Years) Source: Back (Oct/06)
  • 17. RJ 50 Market Opportunities - China Most of the routes have low demand density and low frequencies. 500 383 markets 152 (20%) 68 (9%) 400 51% of total markets Daily Passenger Traffic have less than 300 one daily frequency and less than 135 200 pax/day 100 Number of domestic markets: 755 0 0 1 2 3 4 5 Daily Frequency Source: China Airline Traffic Statistics 2005 (Markets with at least one weekly frequency)
  • 18. China - an unbalanced jet fleet 30-120 seat jets represent only 12% of China jet fleet (30-210 seats), while it is 43% in US and 35% in Europe 4,829 aircraft 826 2,612 100% 80% % of Jet Fleet (J30-210) 58% Seat Segment 65% 60% J121-210 89% J61-120 40% 15% J30-60 24% 20% 43% 35% 28% 4% 8% 12% 11% 0% USA China Europe Source: BACK FleetPC (Jun/06 ; active in service ; scheduled airlines)
  • 19. China - ERJ 145 and 328Jet Routes 29 328Jet 6 ERJ145 Backlog: 50 ERJ145 4 ERJ145 Backlog: 6 ERJ145 5 ERJ145 328Jet Source: CAAC (2005), Embraer
  • 20. RJ 50 Market Opportunities - Russia/CIS Old fleet replacement need: 521 aircraft Improved fuel consumption Lower Operating Costs Increased Productivity 200 Number of Aircraft 150 50 seats 30 seats Avg. Age Avg. Age 76 seats 35 years 32 years Avg. Age 100 29 years 186 189 An-24 Yak-40 146 50 Tu-134 0 Turboprop Jet 30-60 Jet 61-90 Source: BACK (Oct/06)
  • 21. RJ 50s Future Market • Market entered a mature phase in the US and Europe • RJ50s will remain the backbone of US hub feeding system • New market opportunities (long and thin) in the US and EU • Potential in China, Russia and other markets • Secondary market developing
  • 22. E-Jets Helping airlines to improve efficiency
  • 23. E-Jets Family EMBRAER 170/175 EMBRAER 170 • 70 to 80 seats • 2,000 nm Range • Certification: February 2004 EMBRAER 175 • 78 to 88 seats • 1,900 nm Range • Certification: December 2004 EMBRAER 190/195 EMBRAER 190 • 98 to 114 seats • 2,300 nm Range • Certification: August 2005 EMBRAER 195 • 108 to 122 seats • 2,100 nm Range • Certification: June 2006
  • 24. The E-Jets Family - Main Applications Natural evolution for existing 50-seat markets Right-sizing of low load-factor narrow-body flights Capacity, range & seamless service Enhancing services by increasing frequencies New market opportunities – low risk development Medium density and long/thin markets Replacement of old & inefficient jets
  • 25. Market Opportunities – Right-sizing US Domestic (100-160 seat Jet - 12 months ending Sep/2006) r 600,000 c to 100% d Fa r oa ate te r .L e ea try Avg 7 6-s 00 -s Indus 480,000 1 80% Average Load Factor Annual Flights 360,000 60% 240,000 40% 120,000 20% 0 0% 0 0 0 0 50 60 70 80 90 2 <5 10 11 >1 Pax per Departure • 851 thousand flights (40% of total) carried less than 100 passengers onboard Source: BACK
  • 26. Air Canada Strategic Review Presentation (September 27, 2004) Y COP
  • 27. Air Canada - Changing the Game Presentation (Dec/2006) Y COP
  • 28. Delta Flight Plan Presentation (Mar/2007) Y COP
  • 29. US Scope Clauses - Jun/2000 Labor Seats 40 50 60 70 80 90 100 Contract Amendable Year 30 units Not Allowed Unlimited 45-55 seats (Grandfathered rights 36 Avro RJ85 up to 69 seats) 2003 Unlimited Not Allowed 2003 Unlimited Up to 67 units Not Allowed 2002 Unlimited Up to 75 units Not Allowed 2000 Not Allowed Up to 65 units 2000 (Grandfathered rights 18 AirWis BAe 146) Up to 35 units 50 seats and 35 units 69 seats Not Allowed 2003
  • 30. US Scope Clauses - Jun/2006 Labor Seats 40 50 60 70 80 90 100 Contract Amendable Year Unlimited Up to 90 units Not Allowed 2012 Unlimited Not Allowed 2009 “Unlimited” (Up to 110% AA Up to 50 units Not Allowed 2008 narrow body) Up to 200 units Unlimited (30 units 71-76 seats + 3 units for each Not Allowed 2010 mainline aircraft increase) “Unlimited” up to 70 seats Not Allowed 2010 Up to 93 units Unlimited up to 78 seats (86 seats) Not Allowed 2010
  • 31. Market Opportunities - Replacement World Fleet Age Profile (61-120 seats): 2,454 jets with 15 years average age 800 Avg. 30% of 61-120 fleet Region # Acft. 700 Age (735 acft) with more USA, Canada & 600 846 10 Caribbean Number of Aircraft than 20 years 500 Latin America 285 23 400 Europe 617 11 Russia & CIS 231 23 300 Africa 148 22 200 Middle East 48 16 100 Asia Pacific 241 19 China 38 8 0 0-5 6-10 11-15 16-20 21-25 26-30 31-35 >35 World 2,454 15 Age (Years) Source: BACK (Oct/06)
  • 32. Maximizing the Revenue in the Profit Equation Revenue strengths of smaller airplanes Revenues Yields / Fares better market share More flights . . . with business passengers market stimulation More direct better fares and yields flights New markets better yields / more revenue Capacity better yields Management
  • 33. E-Jets Joint Certification means Flexibility • Same Type Design for ANAC, FAA and EASA FAA EASA ANAC FAA EASA EMBRAER 170 February 2004 February 2004 EMBRAER 175 December 2004 August 2006 January 2005 EMBRAER 190 August 2005 September, 2005 June 2006 EMBRAER 195 June 2006 2nd Quarter 2007 July 2006 • Market swap flexibility • Increased residual value
  • 34. E-Jets Commonality Training 70% of the potential Spare Parts 30% of the potential benefits benefits same cockpit, common systems and fly- E170 by-wire technology mean maximum training commonality within the family 100% EMBRA E175 170 175 190 195 ER 170 ------- A/A/A A/A/A A/A/A 86% 175 A/A/A ------- A/A/A A/A/A E190 190 A/A/A A/A/A ------- A/A/A 100% 195 A/A/A A/A/A A/A/A ------- E195 Training Qualification Differences : According to FAA AC 120- 53, grades Based on the aircraft RSPL (Recommended Spare Parts List) range from A (best) to E (worst) in 3 categories: Training Differences, Check Note: Airframe and Ground Servicing Equipment only (Engines are not included). Differences and Recurrent Training • E-Jets have the maximum training commonality (A/A/A) • E-Jets offer an outstanding parts commonality (86% to 100%)
  • 35. The Comfort Factor E-Jets: Narrowbody airplane comfort in convenient sizes CRJ700/900 EMBRAER 170/190 A318/320 17.3” 18.25” 18.0” 16” 19.75” 19” E170/190 advantages: 0.95” (2.4cm) wider seats Widest seats 0.25” (0.6 cm) wider seats 3.75” (9.5cm) wider aisle (+23%) Widest aisles 0.75” (1.9 cm) wider aisle 16% more volume per seat No middle seats Equal volume per seat “Passengers love this aircraft for its spacious interior design and in particular the absence of a middle seat” Bryan Bedford, CEO Republic Airways (Jul/06) “The comfort of the E175 aircraft is important to our customers and the economics of the aircraft make good business sense.” Scott Kirby, US Airways EVP Sales and Marketing (Jul/06)
  • 36. The Trip Cost Factor E-Jets: Lower trip costs than comparable airplanes 8000 7563 - 20% - 32% 7000 6310 6058 6000 US Domestic 5368 5135 Network Airline - US$ per Trip 5000 800 sm trip 4000 3000 Airplane Variable plus Ownership 2000 Costs per Trip 1000 0 E170 E175 E190 E195 A319 / B737-700 2-class seating: 70 78 94 104 124 Costs exclude: revenue related costs and system (overhead) costs Costs include: variable: fuel, crew, maintenance, landing fees, handling fees ; ownership: lease cost, hull insurance, spares inventory costs
  • 37. Air Canada - Changing the Game Presentation (Dec/2006) Y COP
  • 38. E-Jets Family Orderbook Firm Firm Options Deliveries Orders Backlog EMBRAER 170 157 133 128 29 EMBRAER 175 99 136 25 74 EMBRAER 190 317 248 53 264 EMBRAER 195 46 51 3 43 Total 619 568 209 410 (as of December 31st, 2006)
  • 39. E-Jets Customer Base Evolution Customers 1 2 3 4 9 13 18 33 700 619 600 Accumulated Firm Orders 500 440 400 343 300 245 200 110 112 118 100 60 0 1999 2000 2001 2002 2003 2004 2005 2006 Deliveries Source: Embraer
  • 40. E-Jets Worldwide Distribution Customers Asia Pacific / Firm Orders China 14% Middle East / 13% 24% Africa 5% 21% Europe 60% 16% 17% 24% 6% Latin America North America • growing and diversified customer-base across five continents • increased presence in emerging markets with established carriers
  • 41. E-Jets Family - Efficiency to all Business Models Regional Network Low Cost Charter Source: Embraer (Jan/07 ; Sirte Oil and GECAS not presented)
  • 42. E-Jets Deployment - USA and Canada Dec/06 Deliveries Backlog 15 E175 27 E190 18 E190 23 E190 78 E190 36 E175 2 E190 55 E190 16 E170 4 E170 * Natural Growth Right-sizing New Routes 28 E170 40% 42% 18% 0% 20% 40% 60% 80% 100% 28 E170 30 E175 % of Routes (4Q06) E-Jets 134 226 Source: BACK (4Q06), Embraer * to be operated in Mar/07
  • 43. Number of Flights 2,000 4,000 6,000 8,000 0 10,000 12,000 <1 10 00 Source: BACK (4Q06) 1- 2 20 00 1- 3 30 00 1- 4 40 00 1- 5 50 00 1- 6 60 00 1- 7 70 00 1- 8 80 00 1- 90 900 1- 10 100 01 0 - 11 110 01 0 - Distance (nm) 12 120 01 0 - 13 130 01 0 - 14 140 01 0 - 15 150 E-Jets 01 0 - 16 160 E-Jets Operational Profile - USA and Canada 01 0 - 17 170 01 0 -1 80 0 548 nm 474 nm 549 nm 440 nm 663 nm 669 nm Average Stage Length (4Q06)
  • 44. E-Jets Deployment - USA and Canada Efficiency and flexibility for long and short haul markets Airline Longest Route Shortest Route Montreal-Calgary Ottawa-Toronto 1,866 sm - 4:18 (2 Daily) 225 sm - 1:00 (2 Daily) Dallas-New York Atlanta-Charlotte 1,377 sm - 3:46 (1 Daily) 227 sm - 1:14 (1 Daily) Austin-New York Boston-New York 1,515 sm - 3:30 (1 Daily) 187 sm - 1:16 (7 Daily) Denver-Toronto Washington-Norfork 1,310 sm - 3:16 (1 Daily) 175 sm - 1:00 (2 Daily) Houston-Philadelphia KeyWest-Ft.Lauderdale 1,323 sm - 3:06 (1 Daily) 145 sm - 0:49 (1 Daily) Source: BACK (4Q06)
  • 45. E175/190 at Air Canada LaGuardia – Montreal Chicago – Toronto 2005 2007 2005 2007 Seats* 870 508 480 485 6:00 E175 A319 E175 8:00 A319 A319 E175 E175 10:00 A319 E175 A319 12:00 CRJ E175 14:00 A319 E175 E175 16:00 A319 A319 E175 18:00 A319 E175 20:00 A319 E190 A319 22:00 E-Jets Right-sizing at Air Canada: • 76% of total E175/190 routes • 5 routes complementing A319 and 7 routes complementing A320 • 11 routes replacing A319 and 2 routes replacing A320 Source: BACK (4Q06) *4th Wednesday of January
  • 46. E170 at US Airways Philadelphia – Charleston Washington – Portland ME 2005 2007 2005 2007 Seats* 100 190 150 260 6:00 8:00 CRJ E170 CRJ 10:00 E170 12:00 CRJ 14:00 CRJ CRJ E170 16:00 18:00 ERJ 20:00 E170 CRJ E170 22:00 E-Jets Natural Growth at US Airways: • 56% of E170 routes • 17 routes complementing CRJ-100/200 and 4 routes complementing ERJ 145 • 5 routes replacing CRJ-100/200 and 1 route replacing ERJ 145 Source: BACK (4Q06) *4th Wednesday of January
  • 47. E-Jets Deployment - Europe Dec/06 Deliveries Backlog 6 E170 2 E170 10 E170 9 E190 1 E190 2 E195 12 E195 10 E170 6 E175 1 E190 5 E190 15 E170 Natural Growth Right-sizing New Routes 15 E195 41% 53% 3% E-Jets 38 56 0% 20% 40% 60% 80% 100% % of Routes (4Q06) Source: BACK (4Q06), Embraer
  • 48. E170/190 at Finnair Helsinki – Copenhagen Hamburg – Helsinki 2005 2007 2005 2007 Seats* 528 559 252 228 6:00 8:00 A319 A319 10:00 A319 E190 E170 A319 12:00 14:00 A319 E170 E170 16:00 18:00 A319 A321 A319 E170 20:00 E170 22:00 E-Jets Right-sizing at Finnair: • 74% of total E-Jets routes • 44 routes complementing A319/320s • 8 routes replacing A319/320s and 6 routes replacing MD-80s Source: BACK (4Q06) *4th Wednesday of January
  • 49. E-Jets Deployment - Middle East & Africa Dec/06 Deliveries Backlog 14 E170 1 E170 1 E195 6 E195 6 E170 3 E170 2 E170 E-Jets 15 18 Natural Growth Right-sizing New Routes 5% 86% 9% 0% 20% 40% 60% 80% 100% % of Routes (Jan/07) Source: BACK (Jan/07), Embraer
  • 50. E-Jets Deployment - Asia Pacific & China Dec/06 Deliveries Backlog 50 E190 3 E170 11 E190 3 E190 5 E195 2 E170 3 E175 1 E170 1 E170 E-Jets 5 74 Source: BACK (1Q07), Embraer
  • 51. E-Jets Deployment - Latin America Dec/06 Deliveries Backlog 1 E190 4 E190 1 E175 1 E190 6 E190 9 E190 2 E170 2 E170 1 E190 E-Jets 13 14 Source: Embraer
  • 52. E-Jets Family - EIS Statistics E170/175 E190/195 Operators 13 Operators 10 Aircraft in Service 156 Aircraft in Service 67 Flight Hours 582,594 Flight Hours 94,725 Flight Cycles 403,422 Flight Cycles 58,740 Fleet Leaders Fleet Leaders Flight Ho urs (Republic S/N 16) 7,624 Flight Ho urs (JetB lue S/N 8) 3,072 Flight Cycles (Republic S/N 13) 5,243 Flight Cycles (JetB lue S/N 8) 2,164 E170/190 Family Operators* 21 Aircraft in Service 223 Flight Hours 677,319 Flight Cycles 462,162 Source: Airlines (as of Mar 26th, 2007) (*) Air Canada operates E175 and E190 and Tame operates E170 and E190
  • 53. E170/190 at Virgin Blue 6 Embraer 170 14 Embraer 190 “People refer to it as a regional jet, but it is not a regional jet, it is the first airliner that has bridged that gap between NBs and RJs ... It’s a wonderful aeroplane for being able to pick up some markets we fly today that we’re not doing particularly well on.” “It has the mission capabilities to be able to fly the length and breadth of our country, it has the capabilities to fly into the Pacific to where we fly today with our 737s. But we’re able to do it at a lower trip cost.” Brett Godfrey, Virgin Blue CEO Australian Aviation, Jan/Feb 2007
  • 54. E190 at Hainan 50 ERJ 145 plus 50 EMBRAER 190 order “The acquisition of ERJ-145s and EMBRAER 190s represents an important validation of our strategy of providing more flexible flights to match the rapidly increasing demand of the domestic market in China” Chen Feng – Chairman Hainan Airlines ATI News Aug/06
  • 55. E190 at Flybaboo Embraer 190: 5 firm + 5 options “Comfort is one of our constant concerns and I’m truly convinced that, with the EMBRAER 190, we will be offering the highest quality of comfort and service to our clients.” “We selected the E190 for its comfort and its performance. It has four-hour flight endurance, enabling it to reach destinations with a range of more than 3,000 km, along with capability to take-off and land at small airports.” Julian Cook, Flybaboo Founder and Managing Director Source: ATI News, Embraer, Feb 2007
  • 56. 2007-2026 Embraer Market Outlook 4th. Edition A LONG-TERM VIEW OF THE 30 TO 120-SEAT COMMERCIAL JET MARKET
  • 57. Projected Traffic and Economic Growth Growth by Region (2007-2026) USA, Canada & Caribbean RPK Latin America GDP Europe CIS Africa Middle East Asia Pacific China World 0% 1% 2% 3% 4% 5% 6% 7% 8% Average Annual Growth (%) Projected world GDP growth around 3% in the next twenty years will sustain nearly 5% annual increase in air transport demand. Source: Global Insight and Embraer (Oct/06)
  • 58. Regional Trends Europe Russia & CIS • Recovering Economy and Yield • Environment rules may impact air Environment transport growth • Tax Barriers to Western Aircraft • Increased Competition (LCC Expansion) USA, Canada & Caribbean • High Speed Train Competition • Ageing Fleet • Right-Sizing and Direct Replacement • Airline Consolidation Opportunities • Increased Competition (LCC Expansion) • Scope Clause Relaxation • Right-Sizing Opportunities China Middle East • New Policies for Regional Aviation • Increased Competition (Start-ups) • Regional Network Under Development • Pilot Shortage • Slow Liberalization Trend • Concentration on Large Aircraft • High Comfort Standards • Right-sizing opportunities • Travel Demand Growing Above World Level Latin America • Increased Competition (LCC Expansion) • Ageing Fleet Asia Pacific • Right-Sizing and Direct Replacement • Trends Towards Liberalization Africa Opportunities • Increased Competition (Start-ups) • Trend Towards Liberalization • Government Owned Flag Carriers • Concentration on Large Aircraft • Ageing Fleets (Used Aircraft) • Infrastructure Constraints to • Very Fragmented Market growth • Liberalization on some countries / • Pilot Shortage regions
  • 59. Embraer Market Forecast (2007-2026) Worldwide Jet Deliveries Segment 2007 - 2016 2017 - 2026 2007 - 2026 30 - 60 300 1,100 1,400 61 - 90 1,100 1,500 2,600 91 - 120 1,650 1,850 3,500 30 - 120 3,050 4,450 7,500
  • 60. Embraer Market Forecast (2007-2026) Projected Deliveries (30-120 seats): 7,500 Jets Russia & CIS USA, Canada 505 & Caribbean Europe 7% 3,850 1,290 51% 17% China Middle 630 East 9% Africa 230 Latin 130 3% America 2% Asia 480 Pacific 6% 385 5%
  • 61. Thank you 78 airlines. 45 countries. 1 manufacturer. EMBRAER