2002* 2002 farnborough air show five pillars of aerospace business

FarnborourghAir Show

2002

Maurício BotelhoMaurício BotelhoPresident & CEOPresident & CEO

July 24, 2002July 24, 2002

Foward LookingFoward Looking

This presentation includes forward-looking statements or statements about events or circumstances which have not occurred. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting our business and our future financial performance. These forward-looking statements are subject to risks, uncertainties and assumptions.

The words “believes,” “may,” “will,” “estimates,” “continues,” “anticipates,”“intends,” “expects” and similar words are intended to identify forward-looking statements. We undertake no obligations to update publicly or revise any forward-looking statements because of new information, future events or other factors, In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this presentation might not occur. Our actual results could differ substantially from those anticipated in our forward-looking statements.

EmbraerBusiness

Embraer Business

The aerospace businessis supported by 5 pillars High Technology

Qualified People

Global Business

Flexibility

Cash Intensiveness

HighTechnology

High Technology

The Virtual Reality Center

Provides visualization of the aircraft structure and systems during the project phase, using 3D electronic models.

Reduces the development cycle.

Digital Mock-Up EMBRAER 170

High Technology

High Technology

Digital Mock-Up ERJ 145

QualifiedPeople

High School64,5%

PhD0,2% Graduate

29,3%

Post Graduate4,7%

Master1,3%

Qualified People

Educational Levels

25% of the 11,048 employees, are engineers

Qualified People

More than US$ 60 million invested in training and qualification in the last 3 years.

21 2518

1999 2000 2001

GlobalBusiness

Global Business

Civil & Defense Aircraft flying in 58 countries in 5 continents.

Global Business

Current Fleet of Regional Aircraft

Latin America& Caribbean260 aircraft85 customers

Africa & Middle East55 aircraft10 customers

AsiaPacific60 aircraft20 customers

Europe285 aircraft40 customers

North America920 aircraft35 customers

Turboprop Operators

ERJ Operators

Global Business

Operations in Brazil, United States, Europe, Asia and Australia

BrazilGavião Peixoto

BotucatuSão José dos Campos

Eugênio de Melo

USADallas

NashvilleAtlanta

Palm Beach Fort Lauderdale

FranceLe Bourget

UKWeybridge

ChinaBeijing

AustraliaMelbourne

SingaporeSingapore

CashIntensiveness

Cash Intensiveness

In the last 5 years the Company invested almost US$ 1 billion in research & development and productivity.

10481

122147

213

296

1996 1997 1998 1999 2000 2001

US$ 1.3 Billion Investments in the Next 5 Years

Cash Intensiveness

1,283227224239262331TOTAL

34951505971118PP&E

36527

50141

272

1398

342

1308

612

1098

1056

728

1381551

9

Comercial

Corporate

Defense

Others

934176174180191213Research &Development

2002-200620062005200420032002US$ millions

Cash intensiveness

Family launched in July 1999Roll out in October 2001First Flight in February 2002

32 months from launchto first flight

Risk Sharing concept with partners allows the decrease in development cycle and investment risk

Cash Intensiveness

In 2000 Embraer increased its global presence with a US$ 446 million Primary & Secondary Global Offering:

Funds of US$ 240 million in a Primary offering for the EMBRAER 170/190 program

Company positioned in the international capital markets.

Cash Intensiveness

Nearly two-thirds of the EMBRAER 170/190 program development costs borne by Risk-Sharing Partners

Development cost for the new EMBRAER 170 family program:

Cash Contribution from Risk Sharing Partners $ 260Net Proceeds from IPO $ 240Funds From Cash Flow $ 60

$ 560

Risk Sharing Partner Development Cost $ 290

Total Cost of the EMBRAER 170/190 Program $ 850

Flexibility

Flexibility

Embraer has the agility and flexibility to adjust its production in accordance with market demand.

ERJ 135/145Deliveries

Flexibility

Delivery Forecast

4

32

59

96

160 161

135145

1996 1997 1998 1999 2000 2001 2002 2003

Flexibility

To cope with the new scenario, Embraer adjusted its total labor force and laid off 14% (1,800) of its employees.

6,087

4,319 3,8494,494

6,737

8,302

10,33411,048

1994 1995 1996 1997 1998 1999 2000 2001

Total of Employees

Flexibility

Flexibility incorporated into the production line allowed an increase in efficiency and decrease in production lead time

Lead Time in Months

8,0

6,0 6,05,5

4,9 5,04,5

1996 1997 1998 1999 2000 2001 1Q02

Flexibility

Embraer presents one of the highest "revenue per employee" in the industry.

101

172

242 247

307

254

1996 1997 1998 1999 2000 2001

Revenue per employeeUS$ thousand