Embraer

History

Seeking to develop a domestic aircraft industry, the Brazilian government made several investments in this area during the 1940s and '50s. However, it was not until 1969 that Empresa Brasileira de Aeronáutica (Embraer) was created as a government-owned corporation. Its first president, Ozires Silva, was a government appointee, and the company initially produced a turboprop passenger aircraft, the Embraer EMB 110 Bandeirante.

Early growth

The Brazilian Government contributed to Embraer's early growth by providing production contracts. The company sold solely to the domestic market until 1975.

While military aircraft made up the majority of Embraer's products during the 1970s, including the Embraer AT-26 Xavante and the Embraer EMB 312 Tucano, by 1985, it had debuted a regional airliner, the Embraer EMB 120 Brasilia. Aimed at the export market, this plane was the first of Embraer's highly successful small airliners.

License-built Pipers

In 1974, the company started to produce Piper Aircraft light planes under license. Piper first put together knock-down kits in their US factory for Embraer to assemble and market in Brazil and Latin America. By 1978, most of the parts and components were being sourced locally. Between 1974 and 2000, nearly 2,500 license-built Pipers were produced by Embraer.

Privatization

Born from a Brazilian government plan and having been state-run from the beginning, Embraer began a privatization process during the government of Itamar Franco. This was a period of privatization for many state-controlled companies in Brazil. Embraer was sold on December 7, 1994, which helped it avoid a looming bankruptcy. The company continued to win government contracts.

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

Initial public offerings

In 2000, Embraer made simultaneous initial public offerings on the NYSE and BM&F Bovespa stock exchanges. In 2008 its NYSE-traded shares were American Depositary Receipts representing 4 BM&F Bovespa shares and ownership was : Bozano Group 11.10%, Previ 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.

As of December 31, 2014 the shareholders with more than 5% of the Company´s Capital were :

Product line expansion: military, regional and executive

In the mid-1990s, the company pursued a product line more focused on small commercial planes over the military aircraft that had previously made up the majority of its manufacturing. It soon expanded to the production of larger regional airliners, with 70–110 seats, and smaller business jets. Today, the company manufactures for both defense and commerce.

Executive jets

At the 2000 Farnborough Airshow, Embraer launched the Legacy 600, a business jet variant of the ERJ. In 2002, a dedicated business unit was organised as Embraer Executive Jets as the Legacy was introduced. In 2005, the Phenom 100 was then conceptualised as an air taxi like the Eclipse 500, competing with Cessna and Hawker Beechcraft. It was introduced in 2008 and is the basis of the larger Phenom 300. The midsize Legacy 450 and Legacy 500 were jointly developed as clean sheet designs, where the Lineage 1000 is a VIP version of the E190. In 2016, Embraer delivered its 1,000th executive jet and have a market share of 17% by volume, acknowledging it lacks an ultra-long-range large cabin jet.

Military transport

On April 19, 2007, Embraer announced it was considering the production of a twin-jet military transport, the Embraer KC-390. Work began in May 2009 with funding from the Brazilian Air Force. Correios, the Brazilian postal service, has shown interest in buying this aircraft. Using much of the technology developed for the Embraer 190, the C-390 would carry up to 23 tons of cargo and aims to replace Cold War-era cargo aircraft.

While firm orders for this yet-to-be-produced hauler had not yet been made in the fall of 2010, Argentina had asked for six examples and several other South American nations also expressed interest.

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 determined that both countries had provided illegal subsidies to what were supposed to be privately owned industries. Brazil ran an illegal subsidy program, Proex, benefiting its national aviation industry from at least 1999–2000, and 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. The company has offices in Beijing, Fort Lauderdale, Florida (US), Paris, Singapore, and Washington, DC (US).

Non-Brazilian main facilities

Subsidiaries

Joint ventures

Commercial

Military

Corporate

Agriculture

Utility

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. In October 2013, they unveiled the Lineage 1000E.

In May 2011, Embraer announced that it was considering building a larger airliner than the E-jets, with five-abreast seating, but, eventually, choose to develop the second generation of its E-Jet family, as E-jets E2.

In Feb 2014, India's newest airline, Air Costa, announced an order for 50 E-jets E2 aircraft worth $2.94 billion at list price. The order has an option for another 50 planes.

Military

General aviation

Commercial aircraft deliveries

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