SAO PAULO, July 15 (Xinhua) -- A 50 percent U.S. tariff on Brazilian goods would raise the cost of each Embraer aircraft by nearly 9 million U.S. dollars, the Brazilian aerospace company's chief executive warned on Tuesday, calling the measure a potential "near-embargo" that could cripple trade ties.
Francisco Gomes Neto, the president and CEO of Brazilian aircraft manufacturer Embraer, noted that the steep tax -- effective on Aug. 1 -- threatens to make the firm's U.S. exports "unfeasible," with disruptions rivaling those of the COVID-19 pandemic.
The Embraer president emphasized that the United States is the company's primary market, and if the 50 percent tariff takes effect, there is no immediate alternative market that can compensate for the lost demand.
According to company data, U.S. clients account for 45 percent of its commercial airline aircraft exports and 70 percent of its executive jets.
The tariff could destabilize Embraer's Brazilian and U.S. manufacturing units and its American supply chain, he added.
Embraer employs approximately 3,000 people across its U.S. subsidiaries, including manufacturing and service centers, after 45 years of operation in the country.
Gomes Neto explained that the 50 percent tariff would increase the production cost of each aircraft by an additional 50 million Brazilian reals (approximately 8.96 million U.S. dollars), resulting in an annual increase of 2 billion reals (roughly 358 million U.S. dollars) for the manufacturer.
Considering Embraer's growth plans through 2030, the potential impact of the tariff could reach 20 billion reals (about 3.6 billion U.S. dollars).
Despite the pressure, the CEO expressed "optimism" about ongoing Brazil-U.S. negotiations.
U.S. President Donald Trump announced last week he would impose a 50 percent tariff on Brazil's exports. ■