Competitive Strategies Case Study

Embraer in 2005

OR

Abstract:
Empresa Brasileira de Aeronautica SA (Embraer) was established in 1969 by the Brazilian government, to manufacture planes primarily for the Brazilian Air Force. Later, Embraer began to export its military planes to other countries. Encouraged by the success of its military planes business, Embraer decided to manufacture commercial jets. It had become an ideal state-owned enterprise that served the regional and international aeronautical markets well. However, in the late 1980s, Embraer found itself in deep financial crisis and was eventually pushed to bankruptcy. In order to revive the company, the Brazilian government privatised Embraer in 1994. With the change of ownership, the company restructured itself and entered new product segments to gain the early mover advantage. By the end of 2004, Embraer was the second largest regional jet manufacturer in the world after Bombardier Inc of Canada, and registered net profits of US$380 million. The case discusses Embraer’s troubles, its turnaround strategies and new product development.

Pedagogical Objectives:

• To understand how Embraer turned around itself after emerging from bankruptcy
• To understand the impacts of unsuccessful product launches and losing consumer focus
• To discuss Embraer’s new product launches to fill the gap in its the product range
• To discuss how Embraer benefited by entering new product segments and new markets
• To analyse how Embraer rose to become the second largest regional jet manufacturer in the world.

Keywords : Embraer; Bombardier; Regional jet; Boeing; Competitive Strategies Case Study; Brazilian Air Force; Commercial jet; ERJ (Embraer Regional Jet) 145; EMB (Embraer); Legacy executive; CRJ (Canadair Regional Jet); Business jet; Very light jet; Harbin Embraer Aircraft Industry (HEAI); Business Aviation; Military planes

Contents : 
Company Background
The Turnaround
New Opportunities