Embraer: Shaking Up the Aircraft Manufacturing Market
17 Pages Posted: 21 Oct 2008
Abstract
The CEO of Embraer, reflects on his company's dramatic ascent to its position as the world's leading regional aircraft manufacturer. Since becoming a private company, Embraer had successfully introduced seven commercial aircraft models to the market, including its latest, the 118-seat EMBRAER 195. Now, he is concerned because Embraer does not know what to expect from Bombardier, Boeing, and Airbus regarding their competitive response to his company's recent attacks on the commercial aircraft market. How would they respond to Embraer's successful launch of its recent family of jets? Would Bombardier really follow through with its launch of the CSeries? Would Airbus and Boeing perceive the latest attacks by Embraer and Bombardier as attacks on its own family of jets? Most importantly, given Embraer's expectations of rivals' future competitive moves, what should it do next to protect its position and influence its competitors' actions?
Excerpt
UVA-S-0135
Rev. Aug. 1, 2008
EMBRAER: SHAKING THE AIRCRAFT MANUFACTURING MARKET
While traveling to an investor conference in Montreal, Canada on Embraer's Legacy business jet, Mauricio Botelho, CEO of Embraer, reflected on his company's dramatic ascent to its position as the world's leading regional aircraft manufacturer. Since becoming a private company, Embraer had successfully introduced seven commercial aircraft models to the market, including its latest, the 118-seat EMBRAER 195. Now, as his plane began its runway approach just a few miles from the headquarters of rival company Bombardier, Botelho pondered the potential competitive response to his company's recent attacks on the commercial aircraft market.
The U.S. Airline Industry
With the passing of the Airline Deregulation Act of 1978 by the U.S. Congress, government control of routes and fare pricing was eliminated, resulting in growth, increased competition, and the emergence of three new business models: major, regional, and low-cost carriers.
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Keywords: Competitive response, commercial aircraft industry, regional jets, airline industry
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