UPDATE 1 – Embraer Announces More Buyouts As It Gets $ 97 Million Loan Guarantee
(Redesigns with Embraer’s buyback program)
WASHINGTON / SAO PAULO, July 30 (Reuters) – Brazilian group Embraer said on Thursday it would implement a new staff buy-back program, at the same time as the US Export-Import Bank announced it had approved a guarantee of $ 97.2 million working capital loan for the US business aircraft subsidiary.
The Federal Export Credit Agency said the guarantee for Apple Bank for Savings’ one-year revolving working capital facility would support about 800 jobs in the United States, mostly at the Embraer plant. Executive Aircraft in Melbourne, Florida.
EXIM said the loan guarantee would also support supply chain jobs in Arizona, Connecticut, Georgia, Tennessee and Texas.
Embraer has struggled to forge a new future since Boeing Co canceled its $ 4.2 billion buyout of the Brazilian manufacturer’s commercial aircraft business in April.
The company said its new buyback program, the second since the start of the pandemic, will target workers currently on leave or employees who are at least 55 years old.
Workers would get 10% of their salary for each year worked.
Embraer’s biggest rivals Boeing Co and Airbus have also announced plans to downsize in light of the crisis that has hammered demand for air travel.
EXIM said the warranty was necessary because Embraer Executive Aircraft customers delayed business jet deliveries due to the coronavirus pandemic, slashing the company’s revenue.
“In addition, the commercial sector is significantly limited in its lending capacity due to the pandemic and its ability to make new loans has been reduced,” EXIM said.
Boeing has historically been EXIM’s largest customer, using the agency to finance airliner sales to many foreign airlines. (Reporting by David Lawder and Marcelo Rochabrun; editing by Richard Pullin)