Feb. 19 (Bloomberg) -- Empresa Brasileira de Aeronautica SA, the world’s fourth-largest aircraft maker, will cut its workforce by about 20 percent and deliver fewer planes than previously forecast this year because of the global recession.

The dismissals will come from its workforce of 21,362, the Sao Jose dos Campos, Brazil-based company said today in a statement. While 20 percent represents more than 4,200 workers, the company wouldn’t confirm a specific number. The planemaker also reduced its 2009 revenue forecast by 13 percent.

Aircraft makers including Bombardier Inc. and Airbus SAS are scaling back production plans amid tighter financing and as air travel falls. Embraer said the job reductions are concentrated in production and administrative areas and include the elimination of one layer of management. A “significant majority” of engineers will be kept on to develop new products.

“This makes a lot of sense, in the scenario that we’re living in, you have to adjust to the new reality,” said Guilherme Figueiredo, who helps manage the equivalent of $600 million at M. Safra & Co. in Sao Paulo and doesn’t own Embraer shares. ”They’re doing the right thing which is to make an adjustment to prepare the company for the scenario going forward, which will be much worse.”

Embraer now predicts it will deliver 242 commercial and business planes this year, compared with a previous estimate of 270. The revision in deliveries marks the second time Embraer has cut its shipment forecast in three months. The planemaker now sees 2009 revenue of $5.5 billion, down from its previous outlook of $6.3 billion.

Overseas Sales

“Although Embraer has its headquarters in Brazil, the company depends primarily on export markets and on global economic performance -- over 90 percent of its revenues are generated abroad,” the company said in the statement.

Embraer shares fell 16 centavos, or 1.9 percent, to 8.46 reais in Sao Paulo trading. The stock has lost 55 percent in the past 12 months.

The Metalworkers Union of Sao Jose dos Campos said in December on its Web site that Embraer may eliminate 4,000 jobs early this year to cope with falling demand. Embraer later denied the rumors and Chief Executive Officer Frederico Fleury Curado said the company would only take “such a drastic decision if there are risks to the company’s profitability and sustainability.”

In today’s statement, Embraer didn’t say when the job cuts will take place. The company also makes military aircraft, and doesn’t give estimates for those planes.

Europe’s Airbus is the world’s largest commercial-plane maker, followed by Chicago-based Boeing Co. and Canada’s Bombardier.

To contact the reporter on this story: Paulo Winterstein in Sao Paulo at pwinterstein@bloomberg.net. Heloiza Canassa in Sao Paulo at hcanassa@bloomberg.net

Last Updated: February 19, 2009 17:05 EST