Brazil Workers Party threaten Boeing-Embraer talks; JetBlue goes Airbus

It hasn't been a great few weeks for Embraer. Airbus and Boeing are seeking to bolster their global aircraft manufacturing duopoly, now that Airbus has closed its deal to take a stake in Bombardier's CSeries narrowbody programme, but Boeing and Embraer are suffering some political headwinds since they agreed to terms for a joint venture in which Boeing will essentially take an 80% stake in Embraer's commercial aviation business.

The effects of those tie-ups on the global manufacturing industry will be pervasive. And while Airbus is enjoying some momentum from JetBlue's recent order for the renamed A220-300 (formerly the CS300), over the long term the proposed partnership between Boeing and Embraer could result in deeper collaboration on new aircraft programmes and supply chain management.

But there is a cloud of uncertainty hanging over Boeing as Embraer becomes a pawn in Brazil's upcoming presidential election in Oct-2018. The election in Brazil's always volatile political system could deliver a less business friendly and protectionist candidate as the victor, potentially creating roadblocks for Boeing and Embraer in realising their ambitions. Meanwhile in late-Jul-2018, four congressmen from the left wing Workers Party sought an injunction to prevent the talks going ahead.