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USD 2.1 Billion Deal for 24 E195-E2 Jets Boosts Embraer Shares That Recently Escaped US 50% Tariff List.
Embraer announced a historic deal with the Latam group, valued at USD 2.1 billion, for the acquisition of 24 E195-E2 aircraft. The contract, which also includes purchase options for an additional 50 units, represents a significant strengthening of the airline’s regional operations and a robust boost for the Brazilian aerospace industry. The first deliveries are scheduled for the second half of 2026.
The news becomes even more relevant in the international scenario. According to information from Agência Brasil, the announcement comes after Embraer managed to escape a 50% “tariff” that would have been imposed by the United States during the Trump administration on Brazilian products. The manufacturer was included in an exception list at the end of July, freeing key aviation components from taxation and ensuring its competitiveness in the global market.
The Details of the Latam Deal and the E195-E2
The model chosen by Latam, the Embraer E195-E2, is the largest aircraft in the E-Jets E2 family and is noted for its high fuel efficiency and operational versatility. According to Roberto Alvo, CEO of LATAM Airlines Group, the decision was strategic. “The LATAM group’s decision is based on the excellent efficiency of the Embraer E195-E2 and its versatility, which will allow us to continue our growth trajectory with profitability,” said Alvo in a statement released and echoed by Agência Brasil.
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With this acquisition, Latam aims to expand its connectivity and open new destinations. The aircraft has the capability for continental-scale flights, allowing, for example, efficient connections from São Paulo to Lima, Peru. Currently, the Latam group operates predominantly Boeing and Airbus fleets; the addition of Embraer jets diversifies its short- and medium-haul operations. The Brazilian manufacturer is already the main supplier to Azul Linhas Aéreas, a leader in this regional segment.
Commercial Tension and Trump’s Exception
The commercial success of the billion-dollar deal was nearly overshadowed by significant trade barriers. Embraer products were originally targeted by a hefty 50% tariff imposed by the Trump administration on a wide range of Brazilian products, which could have jeopardized the competitiveness of Brazilian jets and components in the world’s largest market.
However, according to Agência Brasil, the Brazilian manufacturer achieved a crucial victory at the end of July. The US government announced a list of approximately 700 products that would be considered exceptions to the rule. This list included aircraft, engines, parts, and aviation components, effectively freeing Embraer and its suppliers from punitive taxation and keeping the path open for robust negotiations.
Economic Impact and Government Reaction
The reaction to the deal was immediate, both in the government and the financial market. President Luiz Inácio Lula da Silva celebrated the announcement on his social media, highlighting that the purchase consolidates Embraer as one of the largest aircraft manufacturers in the world and strengthens our industry and aerospace sector. Lula emphasized the potential for “more jobs, income, and development for Brazil.”
The Minister of Ports and Airports, Silvio Costa Filho, also cited by Agência Brasil, detailed the impact on job creation. Costa Filho estimates that the investments will generate more than 2,000 direct jobs, in addition to boosting connectivity in South America. “This aligns with the growth of aviation, strengthening business and leisure tourism, which generates jobs and income in Brazil,” the minister stated.
The Verdict of the Financial Market
The financial market reacted with strong optimism to the double news: the exemption from the US tariff and the billion-dollar contract with Latam. Confidence in Embraer’s financial health and order backlog was directly reflected in the trading session. The company’s shares experienced a strong increase.
On B3, the São Paulo Stock Exchange, Embraer’s shares (EMBR3) closed with a significant gain of 4.63%. The positive movement was replicated in the international market, where the company is also listed. On the New York Stock Exchange (NYSE), the shares rose 4.02%. The buyer, Latam, also saw its shares in New York advance by 0.95%.
The outlook appears doubly positive for Embraer: it escaped a heavy tariff and closed a billion-dollar contract. But what is the real impact of this for passengers? Do you think this Latam expansion with Brazilian jets will improve the regional routes where you live? Leave your opinion in the comments; we want to know how this news affects your day-to-day.
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