Embraer is seeing signs of stabilization of the business jet market in 2012 but still no significant recovery, particularly at the lightest end of the market, executives say. Speaking to analysts during the release of its fourth-quarter results on March 21, Embraer CEO Frederico Fleury Curado says the company is still experiencing cancellations – “not more, not less” than in late 2011. But cancellations overall are still much lower than at the peak of the down cycle, he says.

Curado is encouraged by progress on the Phenom 300 light jet, which has been selected by NetJets and Flight Options for their fractional programs. “The Phenom 300 is doing quite well,” he says. But as for the Phenom 100 entry-level jet and the smallest end of the market, “We’re not seeing any signal of recovery.” Sales have been stable, though, he says.

Embraer’s executive aviation segment overall remained soft in 2011, with deliveries lower than the company originally anticipated. “2011 was a year marked by signs of continued recession, mainly echoing from Europe,” the company says. The used market remains a drag on recovery, as does tight financing, Embraer says. The executive aviation business, which accounted for 23% of the company’s revenues in 2010, shrunk to 19% last year.

The company continues to make progress toward first flight of its Legacy 500 jet, which rolled out in December. The company last fall disclosed that a software issue with the fly-by-wire control system was delaying the first flight, originally anticipated in late 2011. Curado says the company has been conducting a number of ground tests while it works through the software issue, including ground vibration, engine run and slow- and high-speed taxi. The company is trying to accomplish “as much as we can on the ground before we fly the aircraft, which we foresee for the third quarter,” Curado says. Certification is targeted for 2013.