By Brazil Stock Guide – LATAM Airlines Group (NYSE: LTM; SSE: LTM) has signed a deal worth up to $2.1 billion (R$11.4 billion) with Embraer (NYSE: ERJ; B3: EMBR3) for as many as 74 E195-E2 aircraft. The order includes 24 firm deliveries and 50 purchase options. The strategy is to reinforce regional connectivity and add as many as 35 new destinations starting in 2026, initially in Brazil.
Deliveries will begin in the second half of 2026, with LATAM Brasil receiving the first planes. Other affiliates may follow. The agreement marks Embraer’s first entry into LATAM’s 362-aircraft fleet, currently dominated by Airbus and Boeing. The investment aligns with LATAM’s financial policy, which prioritizes leverage and liquidity after emerging from Chapter 11 in 2022.
“The decision is based on the efficiency of the E195-E2 and its versatility, which will allow us to grow profitably while expanding South American connectivity,” said Roberto Alvo, LATAM Airlines Group CEO.
“Since 2021, we expanded from 44 to 59 airports served nationwide, a record growth that consolidates LATAM as the airline that invests the most in Brazilian aviation. The E195-E2 will give us even more flexibility to connect our vast country with efficiency and sustainability,” said Jerome Cadier, CEO of LATAM Airlines Brasil.
Embraer gains ground in market dominated by Airbus and Boeing
The E195-E2 promises up to 30% lower fuel burn per seat compared with the previous generation. Powered by Pratt & Whitney GTF engines and featuring a 2-2 cabin layout, the model is designed for efficiency and passenger comfort. For Embraer, the contract represents a strategic step in Latin America, where the Airbus A220 competes for share in the regional narrow-body segment.
“LATAM has chosen the most efficient aircraft to support its next growth cycle,” said Francisco Gomes Neto, Embraer CEO.
What’s at stake
The order strengthens Embraer’s position as the world leader in jets of up to 150 seats and consolidates LATAM as South America’s most extensive integrated network, now covering 160 destinations. Since 2021, LATAM has expanded its passenger network by 24%. Adding the E195-E2 gives the airline flexibility to serve mid-sized cities and compete in previously underserved markets.