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Brazil's Embraer trails US'milestones' amid trade tensions

Embraer announced on Thursday that it will announce what it called a "milestone," for the Brazilian aircraft manufacturer in Washington, next week. This is the latest indication of aerospace companies trying to strengthen economic ties with America.

The announcement on September 10 will coincide with an important gathering of leaders in the aerospace industry. Embraer has been lobbying the Trump administration to remove the 10% tariffs from its jets. It also highlighted the dependence of U.S. Airlines on regional jets.

Embraer declined to comment further on the announcement, but sources in the industry said that they expected at least part of it to be focused on increasing U.S. employment and connectivity through its commercial jets.

Embraer sells 45% of its commercial aircraft and 70% of executive jets to U.S. customers, which all rely heavily on U.S.-made parts.

Embraer does not have immediate plans to introduce a new jet model, according to several industry sources, despite the fact that the manufacturer floated the idea of mounting a challenge to Airbus, Boeing, and a upcoming competitor from China.

The announcement was not clear on what else Embraer might have included, claiming that it would be the "first of its kind to be made in the United States".

Watchers in the aerospace industry say that there is a trend among companies to make high-profile announcements, such as industrial decisions and plane orders, in Washington. This is to reduce the impact of Trump’s "America First” policies.

Embraer, in recent months, has asked Washington to lower its tariffs, citing the company's strong ties to the U.S. and its plans to buy $21 billion of U.S. goods by 2030.

Embraer was spared a major blow in July when Trump exempted Brazilian goods from a tariff of 50%, but still faces a duty of 10%.

The E175 E1 is a key aircraft for regional routes in the U.S. The United States is also its No. 1 market for business jets. The U.S. is also the No. 1 market for business jets.

Embraer has assembly plants for executive jets in Florida. It said last month that it would build a $500 million plant in the U.S. for its C-390 military airlifter if the U.S. decided to buy the jet.

Analysts have noted that some of the newly announced initiatives were already underway.

Airbus' chief executive, who will be in Washington, next week, could inaugurate an American assembly line as soon as next month. This is ahead of a planned second assembly line to be opened in China at the end of this year. (Reporting and writing by Allison Lampert; David Shepardson and Gabriel Araujo; editing by Susan Fenton, David Gregorio, Tim Hepher)

(source: Reuters)