Boeing confirms talks to combine with Embraer

[cleonpack93 79]

Looks like Boeing has its response (I mean, apart from Government tariffs) to the Airbus/Bombardier deal.

"Boeing is in talks to acquire or merge with Brazilian aircraft maker Embraer, though “there is no guarantee a transaction will result from these discussions,” the company said Thursday. Boeing did not say whether the potential deal would be a purchase or a merger, calling it “a potential combination.”

“Boeing and Embraer do not intend to make any additional comments regarding these discussions,” Boeing said in a news release. “Any transaction would be subject to the approval of the Brazilian government and regulators, the two companies’ boards and Embraer’s shareholders.”"

https://www.heraldnet.com/business/wsj-boeing-has-held-talks-about-buying-brazils-embraer/

[jabloomf1230 2,445]

This was actually in the works even before the tariff fiasco.

[cleonpack93 79]

Just now, jabloomf1230 said:

This was actually in the works even before the tariff fiasco.

Interesting.

[ubersu 78]

It isn't a bit clear that Brazilian law will allow such a sale. Should be interesting to watch.

DJ

[cleonpack93 79]

Update: the government of Brazil found out about the talks on Thursday and is extremely opposed to the outright sale of Embraer to Boeing, or much of a merger at all.

"Under my government, Embraer will be never sold," said President Temer.

https://airlinerwatch.com/brazilian-government-opposes-the-acquisition-of-embraer-by-boeing/

[jabloomf1230 2,445]

Boeing could file a trade grievance against Embraer also, as long as they are being serious about the "dumping" claim. 

 

[Chock 17,769]

1 hour ago, cleonpack93 said:

"Under my government, Embraer will be never sold," said President Temer.

Considering Temer isn't eligible to run in the 2018 election, that would hardly seem to matter since any talks will probably last longer than his tenure. But even if he could run, a poll earlier this year resulted in over eighty percent of Brazilians being in favour of his impeachment.

Thus all it will take for a green light to any such merger will be for Boeing to grease a few palms in the opposition and the incumbents, and Bob's yer uncle, they'll get the deal whomever wins. That's how politics work most of the time lol.

[Matthew Kane 1,343]

8 hours ago, Chock said:

Considering Temer isn't eligible to run in the 2018 election, that would hardly seem to matter since any talks will probably last longer than his tenure. But even if he could run, a poll earlier this year resulted in over eighty percent of Brazilians being in favour of his impeachment.

Thus all it will take for a green light to any such merger will be for Boeing to grease a few palms in the opposition and the incumbents, and Bob's yer uncle, they'll get the deal whomever wins. That's how politics work most of the time lol.

Not so easy, Brazil is sovereign and has protectionism interests as well and courts to uphold its laws. US interests in smaller countries in recent years haven’t worked. Kim Dotcom is another example they thought they could get little New Zealand to hand him over and greased a few palms their too. Courts don’t work that way. When it comes to the big guy banging on the door it gets very complicated and things get tied up in courts for years until nothing happens, and Kim had to be compensated..

Just because Boeing is interested doesn’t mean Brazil is. It is very difficult to navigate in other countries laws in your own interests 

[Chock 17,769]

8 hours ago, Matthew Kane said:

Not so easy, Brazil is sovereign and has protectionism interests as well and courts to uphold its laws. US interests in smaller countries in recent years haven’t worked. Kim Dotcom is another example they thought they could get little New Zealand to hand him over and greased a few palms their too. Courts don’t work that way. When it comes to the big guy banging on the door it gets very complicated and things get tied up in courts for years until nothing happens, and Kim had to be compensated..

Just because Boeing is interested doesn’t mean Brazil is. It is very difficult to navigate in other countries laws in your own interests 

Whilst that is true, Brazil is undergoing a sea change pushed by the voting public's desire to escape its past reputation for corruptible politics. As a very active part of that, the US courts are closely tied with Brazil and several other countries including notorious banker for dodgy deals - Switzerland. The machinations stretch to such an extent that there has been massive plea bargaining with US Courts over financial improprieties in Brazil, in what the US Department of Justice described as 'an unparalleled bribery and bid rigging scheme'.

Amongst the nearly two hundred plea bargains from those involved in the currently being investigated corruption in Brazil, they included Temer's Treasurer - João Vaccari Neto - with apparently many of the related plea bargains, including Neto's if rumours are to be believed, implicating Temer. That's the kind of climate where people will sell their own grandmother to avoid jail time, thus the notion that nobody could change the incumbent premier's inclinations could well be taken with a pinch of salt when wheels within wheels begin to turn.

In the end it's always about money, and it's quite often not so much a case of people not having a price, but more a case of what that price is. It's obvious enough from the recent shenanigans concerning slapping tariffs on competitors, that Boeing have plenty of sway which can be exerted to apply political pressure. It'd certainly not be the first time in the commercial aviation business that has happened to serve domestic interests, as evidenced by precedents including sales of the BAC 1-11, Canadair Argonaut, Aerospatiale Concorde, Vickers VC10 and deHavilland Comet to name but a few aeroplanes which have come adrift of their expected sales targets courtesy of various departments of trade. This is not to imply that it'd be only the US which would indulge in that kind of thing, nothing could be further from the truth, but what we get to hear about, and what actually goes on, are not always one and the same thing. The idea that large concerns such as EADS and Boeing are not able to influence politics would be a naive one, look at how EADS for example, have made much of the desire for Arabian countries not wanting to be seen to be buying big US airliners, as evidenced by all those Etihad and Emirates A380s, as opposed to 747-400s. So it's nothing if not a door which swings both ways.

As Sydney Camm once wryly observed: 'All modern aircraft have four dimensions: span, length, height and politics'. How right he was.

[Matthew Kane 1,343]

11 hours ago, Chock said:

As Sydney Camm once wryly observed: 'All modern aircraft have four dimensions: span, length, height and politics'. How right he was.

Tenner has already said 'Out Of The Question'. Yes he is not a president elect but he runs the show for another year. This means election time and that will bring out Brazilian Nationalism even more, it will become an election issue and the voters will decide and they will likely vote for Brazilian Interests First. Embraer was a National Company and it hasn't been that long since its IPO, Never underestimate Brazilian Nationalism, they are a very prideful nation and the people will want to keep this company Brazilian.

The other consideration is the USA and China GDP Mark are closing in on one another. China is going to surpass that mark and surpass the USA as the words economic super power. Biggest reason for that is everyone has been diversifying trade portfolio's to not have all the eggs in one basket anymore. USA Trade Influence is no longer what it used to be. Smaller nations get lots of pride from standing up to a perceived bully. Brazil will certainly use that in the upcoming election. People won't want to sell national assets to a declining super power.

As for Boeing the future of that company does not depend on a deal. They are just continuing their posturing, every step in this fiasco it hasn't worked for them, and deal talks with Embraer is just more posturing. I wish Boeing would just get on with what they do best, make great planes, they've lost enough already.

Anyhow, enough Polytics Talk for me. Hard to avoid the subject on here but sometimes Aviation and Politics go hand and hand. I find this fascinating and will wait and see.

Merry Christmas Everyone