How Brazil’s Embraer turned its fortunes around

When Covid hit Brazil two years ago, the outlook for airplane manufacturer Embraer was bleak. The company that was once considered the crown jewel of Brazilian industry had reached an agreement in 2019 to sell its profitable commercial aviation division to Boeing, leaving uncertainty hanging over the future of its defense and executive jet divisions. In early 2020, airplanes worldwide were grounded as the coronavirus spread across the world, casting a cloud over the aviation industry globally. 

Then, in April 2020, Boeing unilaterally pulled out of the USD 4.2 billion merger, accusing Embraer of having failed to meet contractual obligations. (The Brazilian manufacturer rejected such claims and filed a lawsuit in the U.S. seeking compensation.) 

Embraer posted some of its worst results ever in 2020 and its shares lost 56 percent on the São Paulo stock exchange that year, also reflecting the overall impact of the pandemic. 

However, just a short time later, the company has seen a stunning reversal of fortunes. 

Its shares rose 180 percent in 2021, making it the best-performing company in the São Paulo stock market last year. In January of this year, the company’s commercial division — which had been split from...