Embrair
1. How has Embraer managed to succeed as a global competitor from within the confines of an emerging economy? Where appropriate, please make some effort to quantify advantages and/or disadvantages Embraer has derived from the Brazilian context.
First of all, the first step of becoming succeed globally was the decision to privatize the company that subsequently gave more opportunitirs and capabilities for the growth. After that, the wise strategy of the new CEO, Mauricio Botelho, directly affected on a further development of the company. Transforming Embraer from a product – driven company to a customer – focused company helped to determine the main needs in the aircraft market; outsourcing non-core services led to the reduction of production time; well-timed forced layoffs after six-month moratorium in a period of crisis with using flexible salary paid policy, including attracting new young staff, helped to reduce costs on labor. And, of course, the manufacturing of ERG-145 with lower preference price than competitors one, have made the company competitive in the international market.
The main advantages
Brazil is the country with enormous landmass, wide rivers and limited surface transportation infrastructure that forced to develop the aircraft market to satisfy needs on transportation.
The impact of the Brazilian Government to the aircraft industry – helps in developing Sao Jose dos Campos – aeronautical industrial hub, particularly to support Embraer.
The Government of Brazil considered Embraer as a symbol of the country’s economic and technological advancement. That is why Embraer got benefits from relationships with government (no taxes on imported materials and equipment unavailable locally).
The lack of main competitors in domestic aircraft manufacturing market - that allowed Embraer to develop without wasting any additional efforts on rivalry.
The main disadvantages
Serious macroeconomic difficulty in Brazil that caused an inflation of 37.000
First of all, the first step of becoming succeed globally was the decision to privatize the company that subsequently gave more opportunitirs and capabilities for the growth. After that, the wise strategy of the new CEO, Mauricio Botelho, directly affected on a further development of the company. Transforming Embraer from a product – driven company to a customer – focused company helped to determine the main needs in the aircraft market; outsourcing non-core services led to the reduction of production time; well-timed forced layoffs after six-month moratorium in a period of crisis with using flexible salary paid policy, including attracting new young staff, helped to reduce costs on labor. And, of course, the manufacturing of ERG-145 with lower preference price than competitors one, have made the company competitive in the international market.
The main advantages
Brazil is the country with enormous landmass, wide rivers and limited surface transportation infrastructure that forced to develop the aircraft market to satisfy needs on transportation.
The impact of the Brazilian Government to the aircraft industry – helps in developing Sao Jose dos Campos – aeronautical industrial hub, particularly to support Embraer.
The Government of Brazil considered Embraer as a symbol of the country’s economic and technological advancement. That is why Embraer got benefits from relationships with government (no taxes on imported materials and equipment unavailable locally).
The lack of main competitors in domestic aircraft manufacturing market - that allowed Embraer to develop without wasting any additional efforts on rivalry.
The main disadvantages
Serious macroeconomic difficulty in Brazil that caused an inflation of 37.000