Embraer

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Embraer S.A.
TypeSociedade Anônima
Traded asBM&F BovespaEMBR3
NYSEERJ
IndustryAerospace / Defense
Founded1969
HeadquartersSão José dos Campos, Brazil
Key peopleHermann Wever, (interim chairman)[1]
Frederico Fleury Curado, (CEO)
ProductsAircraft, aircraft components, mission systems for air and ground operation
RevenueIncrease US$ 5.7 billion (2011)[2]
Net incomeDecrease US$ 345.5 million (2011)[3]
Employees17.265[4]
SubsidiariesNeiva
OGMA
ATECH
Orbisat
Websitewww.embraer.com
 
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Embraer S.A.
TypeSociedade Anônima
Traded asBM&F BovespaEMBR3
NYSEERJ
IndustryAerospace / Defense
Founded1969
HeadquartersSão José dos Campos, Brazil
Key peopleHermann Wever, (interim chairman)[1]
Frederico Fleury Curado, (CEO)
ProductsAircraft, aircraft components, mission systems for air and ground operation
RevenueIncrease US$ 5.7 billion (2011)[2]
Net incomeDecrease US$ 345.5 million (2011)[3]
Employees17.265[4]
SubsidiariesNeiva
OGMA
ATECH
Orbisat
Websitewww.embraer.com

Embraer S.A. (Portuguese pronunciation: [ẽbɾaˈɛɾ]) is a Brazilian aerospace conglomerate that produces commercial, military, and executive aircraft[5] and provides aeronautical services.[6][7]

Headquartered in São José dos Campos,[8] Embraer is the third-largest commercial aircraft manufacturer in the world,[9] and the fourth-largest aircraft manufacturer after Canada's Bombardier when business jets are taken into account, and it is Brazil's top exporter of industrial products.[10]

Embraer is a member of the Air Transport Action Group (ATAG). Its CEO, Frederico Curado, is the 2012 recipient of the Tony Jannus Award, given annually for distinguished contributions to commercial aviation.[11]

Contents

History

Seeking a domestic aircraft manufacturer, the Brazilian government made several investments in this area during the 1940s[12][13] and '50s,[12] but it was not until 1969 that Empresa Brasileira de Aeronáutica (Embraer) was created as a government-owned corporation.[7]

The company's first product was a turboprop transport, the Embraer EMB 110 Bandeirante.

Early growth

The Brazilian Government contributed to the early growth of Embraer[citation needed] giving it contracts[7] and helping to increase its product line, and the company sold solely to the domestic market until 1975.

While military aircraft made up the majority of Embraer's products during the 1970s,[citation needed] by 1985 a regional airliner had debuted, the Brasilia.[14] Aimed at the export market, this plane marked the first of Embraer's highly successful small airliners.[6]

License-built Pipers

In 1974 the company started to produce Piper Aircraft light planes under license.[15] Piper first put together knock-down kits in their US factory for Embraer to assemble & market in Brazil & Latin America,[citation needed] but by 1978 most of the parts and components were being sourced locally.[15] Between 1974 and 2000 nearly 2500 license-built Pipers were produced by Embraer.[15]

Privatization

Born from a Brazilian government plan and having been state-run from the beginning,[12] Embraer began a privatization process[citation needed] alongside many other state-controlled companies during the government of Fernando Henrique Cardoso.[16]

This privatization effort saw Embraer sold on December 7, 1994,[7][17] and helped it avoid a looming bankruptcy.[12] The company continued to win government contracts.[citation needed]

The Brazilian government retains interest through possession of golden shares, which allow it veto power.[18]

Initial public offerings

In 2000 Embraer made simultaneous initial public offerings on the NYSE and BM&F Bovespa stock exchanges.[6] As of 2008 its NYSE-traded shares were American Depositary Receipts representing 4 BM&F Bovespa shares.[19]

Current ownership

As of 2008 ownership was: Bozano Group 11.10%, Previ (a Brazilian pension fund) 16.40%, Sistel 7.40%, Dassault Aviation 2.1%, EADS 2.1%, Thales 2.1%, Safran 1.1%, Government of Brazil 0.3%, the remainder being publicly traded.[20]

Product line expansion: military, regional & executive

In the mid-1990s the company pursued a product line more focused on small commercial planes than the military aircraft that had prior made up the majority of its manufacturing.[12] Larger regional airliners with 70-110 seats and smaller business jets soon followed.[6] Today the company makes for both defense and commerce.[6][7]

Military transport

On April 19, 2007, Embraer announced it was considering the production of a twin-jet military transport, the Embraer KC-390. Work actually began in May 2009 with funding from the Brazilian Air Force.[21] Correios, the Brazilian postal service, has shown interest in buying this aircraft, in lieu of using commercial freight service for mail transport.[22][23] Using many of the technologies developed for the Embraer 190, the C-390 would carry up to 23 tons of cargo[24] and was aimed at replacing Cold War-era cargo aircraft.[25]

While firm orders for this yet-to-be-produced hauler do not exist,[21] Argentina has asked for six examples and several South American nations have also expressed interest.[26][27]

Government subsidy controversy

Brazil and Canada engaged in an international, adjudicated trade dispute over government subsidies to domestic plane-makers in the late 1990s and early 2000s. The World Trade Organization decided Brazil ran an illegal subsidy program, Proex, benefiting its national aviation industry from at least 1999-2000, and that Canada illegally subsidized its indigenous regional airliner industry, comprising Bombardier Aerospace.

Production bases and facilities

The company's headquarters and a production base are in São José dos Campos, São Paulo, Brazil. It also has production bases in the State of São Paulo at Botucatu, Eugênio de Melo (a district of São José dos Campos) and Gavião Peixoto.[28][dead link] It may have other production bases as well. The company has offices in Beijing,[29][dead link] Fort Lauderdale (US),[30][dead link] Paris,[31][dead link] Singapore,[32][dead link] and Washington DC (US).[30][dead link]

Non-Brazilian main facilities

Subsidiaries

Joint ventures

Aircraft types

Commercial

Lufthansa CityLine Embraer 195LR

Military

EMB-145 AEW&C of Hellenic Air Force

Corporate

Legacy 600

Agriculture

Experimental

Future

In October 2010, Embraer suggested plans to develop very-long-range business jets, entering a sector currently dominated by Gulfstream, Bombardier, and Dassault.[34] In May 2011, Embraer announced that it was considering building a larger airliner than the E-jets, with five-abreast seating.[35]

Licensed-version aircraft

Military

General aviation

Commercial aircraft deliveries

Year199619971998199920002001200220032004200520062007200820092010
Number Of Deliveries4326096160161131101148141130169204244246[36]

The numbers include military versions of commercial aircraft.

Total delivered-backlog-options as of June 30, 2007: 862-53-131 145 Family, 256-399-719 170/190 Family

References

  1. ^ "Botelho resigns as chairman of Embraer". Flightglobal. http://www.flightglobal.com/news/articles/botelho-resigns-as-chairman-of-embraer-366924/. Retrieved 15 January 2012. 
  2. ^ http://www.forbes.com/companies/embraer/
  3. ^ name="marketwatch.com"/
  4. ^ Press Room: Embraer in Numbers embraer.com (Official Site)
  5. ^ The Company: Business embraer.com (Official Site)
  6. ^ a b c d e Corporate governance, pg. 357/651 Robert A. G. Monks, Nell Minow. John Wiley and Sons. 2008.
  7. ^ a b c d e Timeline Embraer Historical Center (Official Site)
  8. ^ The Company: Profile embraer.com (Official Site)
  9. ^ "UPDATE 1-Embraer sells 10 E-Jets to Brazilian airline Azul". reuters. Tue February 14, 2012 11:24am EST. http://www.reuters.com/article/2012/02/14/embraer-idUSL2E8DE8CL20120214. Retrieved February 14, 2012. 
  10. ^ Is Brazil's Embraer Ready To Take On Boeing. Institutional Investor
  11. ^ Gadsen, Sandra J. (March 15, 2012). "Frederico Curado of Embraer named Jannus Award winner". Tampa Bay Times. http://www.tampabay.com/news/humaninterest/frederico-curado-of-embraer-named-jannus-award-winner/1220017. Retrieved 2012-03-15. 
  12. ^ a b c d e OECD Territorial Reviews Madrid, Spain. Page 157/264 OECD Publishing. 2007.
  13. ^ Where core competence soars Rishikesha T. Krishnan. Businessline. Chennai: October 1, 2003. pg. 1
  14. ^ The Embraer EMB120 Brasilia airliners.net
  15. ^ a b c Aircraft History: EMB 710 Carioca Embraer History Center
  16. ^ Brazil on Road Peddling State-Owned Enterprises; [FINAL Edition] John Eckhouse, Chronicle Staff Writer. San Francisco Chronicle (pre-1997 Fulltext). San Francisco, Calif.: January 12, 1991. pg. B.1
  17. ^ Scielo: Os efeitos da privatização sobre o desempenho econômico e financeiro das empresas privatizadas (Portuguese)
  18. ^ Corporate governance, pg. 356/651 Robert A. G. Monks, Nell Minow. John Wiley and Sons. 2008.
  19. ^ Corporate governance, pg. 358/651 Robert A. G. Monks, Nell Minow. John Wiley and Sons. 2008.
  20. ^ Corporate governance, pg. 359/651 Robert A. G. Monks, Nell Minow. John Wiley and Sons. 2008.
  21. ^ a b Portugal interested in Brazilian military cargo plane Anonymous. BBC Monitoring European. London: February 1, 2010.
  22. ^ Costa confirma projeto dos Correios com cargueiro C-390. Monitor Mercantil. August 28, 2007. Retrieved on October 15, 2007.
  23. ^ Brazilian postal service may order Embraer C-390 freighters. Flightglobal.com. September 4, 2007. Retrieved on October 15, 2007.
  24. ^ http://www.embraerdefensesystems.com/english/content/cargo/performance.asp
  25. ^ EMBRAER HAS MILITARY TRANSPORT AIRCRAFT UNDER STUDY
  26. ^ Argentina to buy 6 military transport jets from Brazil's Embraer; BRAZIL-ARGENTINA/AIRCRAFT EFE News Service. Madrid: October 30, 2010.
  27. ^ Defense Watch Anonymous. Defense Daily. Potomac: September 7, 2010. Vol. 247, Iss. 47
  28. ^ The Company: Facilities; Regional Offices: Manufacturing Locations Embraer Official Site
  29. ^ The Company: Facilities; Regional Offices: Embraer - China Embraer Official Site
  30. ^ a b [dead link]The Company: Facilities; Regional Offices: Embraer - North America Embraer Official Site
  31. ^ The Company: Facilities; Regional Offices: Embraer - Europe Embraer Official Site
  32. ^ The Company: Facilities; Regional Offices: Embraer - Singapore Embraer Official Site
  33. ^ "Facilities." Embraer. Retrieved on September 11, 2-12. "Embraer Aircraft Holding, Inc. 276 S.W. 34th Street Fort Lauderdale, FL 33315 U.S.A." and "Embraer Aircraft Holding, Inc. 1700 Pennsylvania Ave. NW Suite 200 U.S.A. Washington, DC 20008"
  34. ^ Embraer mulls over new types flightglobal.com, 21/10/10
  35. ^ [http://www.flightglobal.com/articles/2011/05/06/356264/correction-embraer-eyes-possible-five-abreast- aircraft.html "CORRECTION: Embraer eyes possible "five-abreast aircraft""]. 2011-05-06. http://www.flightglobal.com/articles/2011/05/06/356264/correction-embraer-eyes-possible-five-abreast- aircraft.html. Retrieved 2011-05-08. 
  36. ^ http://www.tradershuddle.com/20110118148417/PRNewswire/Embraer-Closes-Out-2010-With-246-Jets-Delivered.html

External links

Further reading