Due to the "unprecedented crisis hitting the world economy," Embraer announced on Feb. 19 it will lay off 20% of its 21,000 workers. The ax would fall on factory workers, administration staff and managers, it said. The company did not give an exact figure of how many jobs would be cut. The one-in-five proportion given suggested it would be more than 4,000.
The company, which trails third behind Airbus and Boeing in the world commercial aviation market, earns 90% of its revenues from exports. Nearly half of its earnings come from the U.S. and Canada.
Embraer makes short- and mid-range passenger aircraft, as well as planes for defense and government clients around the world.
In 2007, Embraer made $284 million in profit. In the nine months to end-September 2008, the company was showing an $86 million profit, after the crisis late in the year dealt it a third-quarter $21 million loss. Fourth-quarter 2008 orders shrank to $20.9 billion from $21.6 billion in the previous quarter.
The company revised downwards its delivery forecast in 2009 to 242 commercial aircraft worth $5.5 billion, from 270 previously. Before last November, it had been banking on delivering 320 aircraft.
Copyright Agence France-Presse, 2009