In a surprising turn of events, Embraer has been granted a special exemption from the proposed hefty tariffs on Brazilian imports to the United States. This comes after significant pushback from US airlines like Republic Airways and SkyWest Airlines, which rely heavily on Embraer E-jet fleets. These airlines had made it clear they would not absorb the proposed 50% tax increase, which would have added a staggering $9 million to the cost of each Embraer regional jet. The Rio Times had reported that Embraer was bracing for a potential $3.6 billion loss by 2030 if the tariffs were implemented, a scenario that could have led to severe layoffs reminiscent of the COVID-19 travel downturn. With over half of Embraer’s commercial and executive jets sold to US carriers, the stakes were incredibly high.
The proposed tariffs, initially set to take effect on August 1, 2025, were part of a broader strategy by the Trump administration to impose tariffs on various Brazilian imports, including oil and coffee. This move threatened to increase costs for American consumers across the board, including the price of aviation fuel, which is also imported from Brazil. SkyWest’s Chief Commercial Officer, Wade Steel, had previously stated that the airline would work with its partners and Embraer to delay jet deliveries until the tariff issue was resolved, highlighting the industry’s collective effort to combat these trade barriers.
The aviation sector, known for its intricate global supply chains, relies on international cooperation to maintain safety, affordability, and reliability. The Trump administration’s tariff plans had put this delicate balance at risk, drawing criticism from various quarters, including Trump’s own Secretary of Transportation, Sean Duffy. Duffy had urged the government to honor its longstanding zero-tariff agreement from 1979. Airbus CEO Guillaume Faury also weighed in, emphasizing that such tariffs would be detrimental to all parties involved. With the exemption now in place, the aviation industry can breathe a sigh of relief, at least for the time being.
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Originally reported by Simple Flying Read More
