Brazilian Unions Fear Result of Embraer-Boeing Tie-up

Photo: AirlinerWatch

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Political tensions arising from talks taking place between Embraer and Boeing are rising further as labor union leaders have accused the Brazilian government of colluding behind the backs of Brazilians.

At Monday’s Senate hearing Herbert Claros da Silva, vice president of the metalworkers union of Sao Jose dos Campos said that: “We are being left in the dark. No one is explaining to us why this is good for Brazil,” adding: “We ask President Temer not to sell Embraer.”

The hearing had been called by Workers Party Senator Paulo Paim to discuss the talks between Boeing and Embraer for a potential partnership over which the government has veto power. Despite privatizing Embraer, the Brazilian government still retains a golden share in the plane-making business.

Embraer and Boeing passed no comment on the hearing, while a spokesman for the Defense Ministry, which has led a government working group vetting the deal, said the hearing was about jobs and not a defense matter.

Embraer and Boeing are looking to create a joint venture which will see the creation of a new, third company, which would include Embraer’s commercial aircraft division, but which would exclude the defense unit.

A tie up of this nature would see Embraer take a major share in the 70-130-seat sector of the market, providing stiff competition for Bombardier and it’s CSeries of jets.

Union leader Silva acknowledged at Monday’s hearing that a tie-up would initially be a boon for Embraer as Boeing would help market its shorter-range jets around the world, but he was more concerned about the longer-term future of the 14,000-strong workforce at plants in Sao Jose dos Campos.