Embraer's CEO expressed that proposed tariffs by Trump could be as destructive to the company as the pandemic. Trump has threatened a 50% tariff on Brazilian exports, affecting nearly half of Embraer's regional airliners and a significant portion of business jets delivered to US clients. The CEO projected that if implemented, these tariffs would lead to a revenue decline akin to that caused by COVID-19. He noted that shipping certain jets would become unfeasible and emphasized the negative impact on both Embraer and US suppliers of aviation parts.
Given the relevance of this market, we estimate that if this [Trump's tariff plan] moves on at this magnitude, we will have an impact similar to that of COVID-19 in terms of the decline in the company's revenue.
Shipping Embraer's E175 jets, which play a major role in regional aviation, would become "unfeasible" with tariffs.
It's a lose-lose situation, emphasizing that the tariffs would be damaging to the US, as it supplies parts like engines and avionics.
The firm's share price has fallen 8.5% in the past five days, but is still up more than 25% since the start of the year.
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