FLYING HIGH THROUGH SEGMENTATION

Presented by

• Namrata Gupta• Gauri Bhasme • Dinesh Gera• Hemant Patil• Bhushan Patil• Kanik Vijay• Abhishek Agarwal

Embraer, the Brazilian aircraft manufacturer was established on July 29th 1969 as a government owned company.

EVOLUTION

In 1977 it got separated from government control.

The success story of Embraer can be described as “A Saga from Agony to Glory”

Embraer has attained the position of the third largest aircraft manufacturer in the world, after Boeing and Airbus

THE EMBRAER’S WAY

The company entered the market when big players like Boeing and Airbus had already captured the market

So Embraer focused on niche market segments since its inception

Since Boeing and Airbus targeted the large commercial jet market, Embraer targeted the regional market segment facing competition from Bombardier.

The Bandeirante and Brasilia models were a great success for the company

Bandeirante

Brasilia

BUSINESS AREAS

Embraer is a company with more than 40 years of existence caters to three market segments

In order to cater these markets, Embraer has headquarters in Brazil, offices, Subsidiaries and customer service based in China, France, Portugal, Singapore and the United States

MARKET SEGMENTS AIRCRAFTS

Commercial Aviation

Executive Aviation

SUPER TUCANO; EMBRAER 145 AEW&C; EMBRAER ULTI INTEL; EMBRAER 145 MP; Defense System

EMB 120; ERJ 135; ERJ 140; ERJ 145; ERJ 145XR; EMBRAER 170; EMBRAER 175; EMBRAER 190; EMBRAER

195

LINEAGE 1000; LEGACY 650; LEGACY 600’ LEGACY 500; LEGACY 450; PHENON 300; PHENON 100

SERVICE-MANUFACTURING FIRM

In order to support its customers and provide after sales service, Embraer developed Aviation Services Business units, which encompasses aircraft maintenance, spare parts, training and aeronautical systems.

Embraer offers services (as designing, selling and supporting) and products (manufactured aircrafts) in a complementary way in order to attend aviation markets.

For the other side, Embraer also offers services by support activities in order to support its customers and provide after sales service.

This increases the value of the Embraer products i.e. the Aircrafts

Thus, the Embraer’s combination of products and services showcases how service is related with manufacturing firms

Moreover the Embraer Aviation services are developed to provide continuous value-added services to customers.

SERVICE-MANUFACTURING FIRM (cont.…)

CAIRCRAFT

(Designing, selling and supporting)

BCUSTOMER

(Commercial, Defense or Executive)

AEMBRAER

(By Aviation services and all other services

activities) Possible Collaboration

Request of Intervention

Owns or UsesOperation

intended to change state of C

OUTCOME

Embraer case is a perfect evidence of product-service combination in a manufacturing context

Shifted from traditional product-manufacturing company to goods-service provider

This allowed a way to obtain competitiveness

This lead to a B2B service market that existed around the product which was catered by Embraer

ENVIRONMENTAL INITIATIVES

ISO 14001 since 2002, first in the industry

Ipanema: First certified and serialized 100% biofuel powered aircraft

Reforestation project:600,000 tress

350 hectare area

ENVIRONMENTALLY FRIENDLY RESEARCH PROGRAMS

Design & Aerodynamics Structures

Biofuels

Power plants Systems

ECONOMIC FINANCIAL PERFORMANCE

Embraer ended the year with the total deliveries of 90 commercial and 119 executive aircrafts

In 2013, the revenues reached US $6325 million

45% of the revenue was from the commercial aviation, followed by defense and security contributing 32% and executive jets contributing 21%

The company backlog ended 2013 at a value of US $18.2 billion, showing 46% growth from the US $12.5 billion reported at the end of 2012.

CONCLUSION

Embraer is a case study that contributes to the discussions about how a manufacturing company can generate a variety of revenue streams from both product and service transactions

Embraer turned itself into a service-manufacturing company working closely with its customers and suppliers

The analysis shows how designing, manufacturing, selling and supporting aircraft for the global airline business results in a B2B service network which Embraer identified.