SkyWest orders 20 old-generation Embraer jets as order for new line remains paused

FILE PHOTO: The logo of Brazilian aviation company Embraer is seen during the Latin American Business Aviation Conference & Exhibition fair (LABACE) at Congonhas Airport in Sao Paulo, Brazil August 14, 2018. REUTERS/Paulo Whitaker

(Reuters) – Brazilian planemaker Embraer SA (EMBR3.SA) said on Thursday that U.S. regional carrier SkyWest Inc (SKYW.O) had signed a firm order for 20 E175 planes from the E1 generation, worth close to $1 billion, as an order for a newer, more efficient plane remains in limbo.

SkyWest ordered as many as 100 next-generation Embraer planes, known as the E2 line, but pilots in the United States have so far declined to fly it due to contract restrictions.

Embraer has removed SkyWest’s order for the newer E175-E2 from its backlog, a document where the planemaker lists the number of orders it has received for its various planes. So far, Embraer does not list any official orders for the E175-E2 plane.

SkyWest was the launch customer for the broader E2 line back in 2013, announcing back then an order for 100 E175-E2 planes and options for 100 more, which would be worth as much as $9.4 billion.

Embraer executives said at the time that the order was a vote of confidence in the new aircraft line, but it has since faced some delays. The order was removed from the backlog in 2018 because of labor disputes with pilots unions.

Embraer has yet to deliver any E175-E2 jets. Embraer executives have said the planes might have more commercial success outside the United States, where there are fewer pilot restrictions on the aircraft size.

Reporting by Marcelo Rochabrun; Editing by Daniel Wallis

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