(Adds details of partnership, comments from executives)
By Brad Haynes
RIO DE JANEIRO, April 4 U.S. aviation
electronics maker Rockwell Collins Inc and Brazilian
planemaker Embraer SA agreed on Tuesday to work on
integrating their remote sensing, targeting and communications
portfolios for joint defense sales.
The announcement at the LAAD defense expo in Rio de Janeiro
confirmed an earlier Reuters report that the long-time partners
in the aerospace supply chain were eyeing joint sales in defense
as demand in commercial aviation begins to cool.
Jackson Schneider, head of Embraer's defense division, said
the partnership could eventually lead to shared development of
new technologies, but for now the companies aim to combine
existing products to offer more complete defense offerings.
The first opportunity identified by the firms would
integrate the M20 radar made by Embraer subsidiary Bradar with
the FireStorm targeting system made by Rockwell Collins to offer
soldiers a portable, protected command center in the field.
Colin Mahoney, head of international and service solutions
for Rockwell Collins, said the partnership made sense both
technically and commercially. Mahoney highlighted his company's
strategic relationships in the United States and Middle East,
compared with Embraer's strength in the South American market.
"This is a two-way partnership," said Schneider,
underscoring the potential for sales both in Brazil and abroad.
The executives did not venture estimates of potential
revenue from their joint sales.
International partnerships are common in the aerospace
industry, especially on defense contracts where government
relations are key. Embraer has partnered in recent years with
Boeing Co to sell and support the KC-390 military cargo
jet and with Israel's Elbit Systems Ltd to study a
potential joint venture to build drones.
One outlet for the new Rockwell Collins partnership could be
the Brazilian government's SISFRON program, which is aimed at
securing long stretches of the country's remote 17,000-km
(10,500-mile) border against arms and drug trafficking.
Embraer's subsidiaries have completed about 70 percent of
the initial SISFRON contract, Schneider told Reuters, adding he
was watching whether a federal spending freeze would hit the 450
million reais ($145 million) earmarked for the program in 2017.
He declined to comment on the chances of a much-discussed
second phase for the program.
Joint sales with Rockwell Collins could open new markets to
Embraer's fledgling defense portfolio, which grew as Brazil's
military spending surged early this decade before the government
delayed or scaled back several programs due to a deep recession.
(Editing by Lisa Shumaker)