Embraer inks record Flexjet order, boosting shares
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Embraer inks record Flexjet order, boosting shares
SAO PAULO (Reuters) - Brazilian planemaker Embraer has signed a deal to supply Flexjet with up to 212 jets, it said on Wednesday, a contract valued at up to $7 billion at current list prices.
The agreement represents the largest firm order ever for Embraer's executive aircraft, with firm orders for 182 aircraft and options for another 30, the group said in a statement.
The order from Flexjet, which allows clients to buy a part-share in aircraft, comes as a major boost for the Brazilian company, which had already been riding tailwinds on strong demand for its commercial and military aircraft.
Shares of the planemaker, which more than doubled in value in 2024, were up more than 9.5% in early Sao Paulo trading after the deal was announced, making it the top gainer on Brazil's benchmark stock index Bovespa.
The deal comprises a fleet of Praetor 600, Praetor 500 and Phenom 300E jets along with related services and support.
"This is the largest order placed by Flexjet in its 30-year history and is also the largest firm order for Embraer's executive aircraft," the Brazilian company said.
Embraer in 2023 signed a deal with NetJets for up to 250 Praetor 500 jets, but those were options that the Berkshire Hathaway-owned firm started to convert into firm orders last year, in a positive sign for the business jet segment.
The planemaker did not disclose when the Flexjet orders will be added to its backlog, or when deliveries are set to begin.
Analysts at JPMorgan expect the deal to increase Embraer's total backlog by about 26% to around $28.7 billion, forecasting deliveries over the next five years as Flexjet plans to double its fleet in the period.
"We view today's announcement as very positive," they said in a note to clients.
