Uh-oh. Just when all seemed to be going well for Motley Fool Stock Advisor pick Embraer (NYSE:ERJ), trade publication Flight International published a story stating that demand for regional jets has "collapsed." (Gulp.)

That's a pretty accurate description. Net deliveries of regional aircraft from Embraer, ATR, and Bombardier dropped to 111 planes during the first half of this year, down from 148 aircraft deliveries during the first half of 2005. Meanwhile, net deliveries of turboprops -- short-range propeller-powered passenger aircraft, an ATR specialty -- soared by 50%.

It gets worse. Flight International's findings reveal that while demand for classic 50-seat regional jets -- once a staple for Canadian rival Bombardier -- cratered, Embraer saw the largest decline in jet orders. (Bombardier actually enjoyed a modest net gain, helped by sales of its larger CRJ 900s.)

Specifically, Embraer's 135, 140, and 170 models drew 89 fewer orders than a year ago. And while the 190 and 195 have proven popular with airlines like JetBlue (NASDAQ:JBLU) and U.S. Airways (NYSE:LCC), 69 first-half orders for the new jets, plus five for the ERJ-145, couldn't overcome the year-over-year shortfall in older models, leaving Embraer down 15 orders from the first six months of 2005.

How worried should investors be? Not very. We've long known that the 190 and 195 would supplant the 170. Meanwhile, executives have shifted their strategy away from sales of 50-seat jets to roomier 70-to-100 seat planes. Doing so has allowed Embraer to be more creative in filling the needs of its airline customers. US Airways, for example, plans to have its newest Embraer jets feature a first-class cabin for short-hop business travelers.

Investors should also pay close attention to Embraer's backlog. In June, it had declined to $10.2 billion from $10.9 billion the year prior. That would be worrying if orders weren't rolling in, but they are -- at home and abroad. In fact, more than 220 E-190 jets are on order as I write. So long as this number remains steady or increases, stockholders should continue to enjoy a powerful tailwind.

Prepare for take-off with related Foolishness:

Embraer and JetBlue are both Motley Fool Stock Advisor selections. Ask for us anall-access pass, and you'll get a backstage look at all of the stocks that are helping David and Tom Gardner beat the S&P 500 by more than 41% as of this writing. It's yoursfree for 30 days.

Fool contributor Tim Beyers doesn't own shares of Embraer, but he has rated the stock to outperform in Motley Fool CAPS, a new service where players compete to see who's the best investor. Learn more here, then get in the game.

Get an inside peek at all the stocks Tim owns by checking his Fool profile. The Motley Fool's disclosure policy is always on time for departure.