Embraer

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FLYING HIGH Brazil-based Embraer is one of the world's leading aerospace conglomerates, with a diverseproduct portfolio comprising commercial, defence and executive jet aircraft. Sarah Pursey speaksto Managing Director, Mr Ricardo Pesce, about the growth of Embraer's global operations, andthe new aircraft that are further reinforcing the company's reputation for quality and technicalinnovation. Written by Marius Goubert. ‡

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In 1969, following the Brazilian Ministryof Aeronautics’ development of a prototypeaircraft dubbed the Bandeirante EMB-110,Embraer was founded as a public limitedcompany. Under the IPD-6504 programme,which was headed by French engineer MaxHolste, the Bandeirante (Portuguese for ‘pio-neer’) was a twinturbo-prop light transporta-tion aircraft combining extreme reliabilitywith minimal operating costs. “The govern-ment realised that the product was sogood,” Mr Pesce tells us, “that they decidedto establish a company specifically taskedwith producing the aircraft in large quantitiesand so Embraer came into being.”

Embraer spreads its wings Initially tasked with producing 80 models ofthe Bandeirante EMB-110 for the Brazilianair force, Embraer sought to further expandits product range and undertook work toindependently develop a new model air-craft which become known as the EMB-120 Brasilia. Similar to the Bandeirante, theBrasilia was a twinturbo-prop airliner andentered into commercial production in 1985.“This was a pressurised airplane capable oftransporting 30 passengers compared withthe Bandeirante’s capacity of 90,” continuesMr Pesce. “Both of these airplanes becamecrucial factors behind the development ofEmbraer, and were launched onto themarket at exactly the right time to capi-talise upon the 1978 deregulation of theUSA’s aviation industry. Many new airlinerscame into being around this time and wewere well placed to supply them withhigh quality products.” It was following this deregulation of the

aviation industry that the company began toexpand its operations overseas. With demandfor its aircraft steadily growing within the USmarket – which soon came to account for themajority of Embraer’s EMB-120 sales – thecompany established its first overseas oper-ation in Florida in 1979. Four years later, asecond overseas facility was established inFrance to cater to the European market.Indeed, the success of the EMB-120 would ‡

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lay the foundations for Embraer’s first familyof aircraft: the ERJ series, as Mr Pesce goeson to explain: “It was during our developmentof the ERJ series that the company wasprivatised. This occurred on the 4th ofDecember 1994, and the privatisationceremony was held at the Brazilian stockexchange in San Paolo. Three major groupsbecame the shareholders: one investmentbank and two Brazilian pension funds. Theircombined investment power was more thanUS$100 billion, and two years after pri-vatisation, the ERJ family was launched into the global market.” Comprising a total of three models: the

ERJ 135, 140 and 145, the ERJ was specif-ically designed to cater to the requirementsof regional airlines. Equipped with Rolls-Royce AE3007 engines and providing pas-senger capacities that range from 37 to 50,the ERJ family became particularly popularwith regional airlines operating in Europeand the US. “We have delivered 1,100 ERJsto date in three different models for com-mercialisation,” states Mr Pesce. “We havealso produced on derivative for the execu-tive aviation market which is called theLegacy 600.” While the Legacy 600 repre-sented the first in a line of six executive air-craft that would come into operation overthe proceeding years, Embraer unveiled itssecond series of commercial aircraft, theE-Jet, in 1999.

The E-Jet family “To date, we have received over 900 ordersfor this family of aircraft and made 600 deliv-eries in 60 countries,” he informs. “The E-jets are a little bit different from the ERJfamily, which concentrated on supplyingfewer customers with larger orders. E-Jetsales have been much more diverse in termsof their global sales. We are supplying thesemodels across all five continents, and ourmarket has become far broader as a result.The series ranges from 70 to 122 in terms ofpassenger capacity, and comes in four dif-ferent models: the E170, E175, E190, E195.It was developed with input from the airlinesand passengers, which enabled us to opti-mise the design to cater to the require-

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ments of our clients and their customerbase. Indeed, this became a key reasonbehind the commercial success of the E-Jet range. They were developed based onthe requirements of the market, and have a very good range as they can fly up to2500 nautical miles, which is ideal for regional operations.”In view of the success of the ERJ and E-

Jet series, Embraer not only managed to laysecure foundations for further internationalexpansion, but continued to diversify itsproduct portfolio. “In 2000 we opened twooffices in Asia, one in Beijing and one inSingapore, which focused on sales, mar-keting and customer support. We are able tosupply our clients with spare parts and pro-vide training services as we operate simula-tors in both Singapore and in China. Interms of our product range, we launched the KC930 in 2009, which has a 19 toncargo capacity and utilises a twin turbofan.We have received orders for 20 units of thisplane from the Brazilian air force, and arediscussing the possibility of entering intopartnerships with several other countrieswho are very interested in this programme– such as Argentina, Africa and Colombia.Indeed we are anticipating that the KC930will become a very big success in the future.”While Embraer’s range of defence aircraft

also comprises the Legacy 800 and threederivatives of the EMB-120 series (which arepredominately used for surveillance pur-poses), Mr Pesce cites the company’sdefence model, the Super Tucano, asanother particularly successfully model in its expanding military portfolio. “The SuperTucano is an advanced turboprop trainer air-craft and named after the Toucan bird foundin the Amazon. We have recently secured a contract to supply this aircraft to theIndonesian government and, with regard to all the customers who purchase our air-craft, we are also able to offer a comprehen-sive range of after sales services. Theseinclude inviting them to invest in theirown inventory of spare parts which westore and then supply on request. Indeed, in terms of the development of our clientbase, we are now supplying two major oper-

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ators in Brazil – including Jet blue, a newregional airline, whose flight is exclusivelycomprised of E190 and E195 aircraft.American Eagle, Continental, Republic andBritish Airways represent further operatorswho have acquired aircraft from our E-Jet range.”

Committed to quality In terms of its production facilities, the com-pany operates three separate manufacturingunits located in Brazil – two of which spe-cialise in the production of military aircraftwhile the other focuses on the final assemblyof its commercial and executive airliners. “Interms of commercial aviation, the E-Jetfamily is in full production and, while thefinal assembly is done at our headquartersin Brazil, parts of the aircraft are producedabroad in countries such as Korea,” informsMr Pesce. “They are then shipped to Franceand then onto Brazil for final assembly.However, as we converted our ERJ145production line to manufacture the Legacy600, we are now producing the ERJ145 inChina through a joint venture with AVIC(Aviation Industry Corporation of China).Along with military and commercial aircraft,we also manufacture the Ipanema cropdusting aircraft and are very proud of thefact that this plane enabled us to be thefirst company in the world to success-fully use ethanol: a biofuel produced from sugar cane.” Indeed, its ability to innovate and incor-

porate pioneering technologies into its aircraft design has become a definingcharacteristic of Embraer, and an attributethat, according to Mr Pesce, was substan-tially enhanced following the company’s1994 privatisation. “The merger betweenthe technological base (which had beendeveloped when we were a state company)and the entrepreneurial aspect that camewhen we were privatised was a prefectmarriage,” he informs “Furthermore, one of Embraer’s major strength has always beenthe technical proficiency of its personnel.The government’s decision to found Brazil’sAeronautic Engineering School in 1950meant that we were fortunate enough to

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gain access to a local source of high-qualityaeronautical engineers. Indeed, many ofthe company’s senior management – myselfincluded – are graduates of this institution.On the environmental side, we were thefirst aerospace company in the world tobe awarded the ISO 14001, and one of very few companies to be listed on the Dow Jones sustainability index.Currently we are doing a project along-side Azul Airlines to test jatropha biofuel,and overall, we dedicate a very large chunkof our budget to research and develop-ment activates. The financial cost is high as aviation is a very cash and labour inten-sive business, but it is imperative that we continue to innovate and develop new products. “However, one major problem is the fact

that we are facing a shortage of skilled per-sonnel,” he continues. “The numbers of engi-neers who are graduating are insufficient tomeet market demand, so we are trying tosource skilled workers from other parts ofthe world in order to support our R&Dactivities. Currently we have around 300engineers fully dedicated to R&D in Brazilwhile our total workforce now comprises17,000 employees worldwide. Our futureambitions are diverse however. We arelaunching two more executive jets, theLegacy 450 and 500, which will be releasedaround 2014. They are very advanced execu-tive jets and utilise ‘fly by wire’ technologywhich decreases the workload of the flightcrew. We are also finalising a new factory inMelbourne, Florida, to produce two modelsof the Phenom: the 107 and the 300. In2012, we will also begin producing aircraftcomposites in Alverca, Portugal, where weare in the process of establishing two plantsthat will manufacture restructuring andcomposite materials.” Underpinning all of Embraer’s global

expansions so far has been the company’sability to adapt to the demands of highlycompetitive marketplace. Now, as it seeksto strengthen its worldwide presence, thispioneering spirit looks set to continuebuilding strength as Embraer forges a clear path ahead. o

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