Free «Airbus and Embraer» Essay
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The aircraft manufacturing sector is a part of the aerospace industry which covers the design, production, maintenance, repair and overhaul of diverse aircraft. Among the world’s leading aircraft suppliers, there is Airbus that competes with Boeing in the middle and large size segments, while being threatened by Bombardier and Embraer in the small size segment of their market. The mission of each aircraft manufacturer lies in providing the best suited aircraft to satisfy the market’s demand and supporting it with the highest quality of service.
Since it was founded in 1970 and up to the end of August 2012, Airbus has received orders for 11,863 commercial aircraft from approximately 334 customers around the world (EADS Registration Document, 2011). In its 43-year history, Embraer has delivered over 5,000 aircraft that operate in approximately 100 countries on five continents (Embraer, 2012).
In 2011, Airbus recorded total revenues of € 33.1 billion, including total revenues of € 2.5 billion at Airbus Military, while Embraer ended fiscal year of 2011 with a firm order backlog of US$15.4 billion. The Airbus commercial product line covers aircraft ranging in size from the 107-seat single-aisle A318 to the 525-seat wide-body A380. Meanwhile, Embraer specializes on manufacturing commercial jets with up to 120 seats (EADS Registration Document, 2011; Embraer Annual Report, 2011).
In 2010, Embraer changed its name from Empresa Brasileira de Aeronáutica to Embraer S.A. in order to expand and diversify its business areas. Besides developing, producing and supporting its aircraft, the company also began to engage in technological, industrial, commercial, and service activities for the markets, in which it is involved (Embraer Annual Report, 2011). Airbus continues to invest in research and development with the purpose of product range extension. It also applies its expertise to the civilian and military market, as well as broadens its portfolio of freighter aircraft (Airbus, 2012).
With an international customer base, both companies keep contributing to the integration of the world. Nowadays, aviation allows shortening distances between people using the benefits of the most modern aircraft.
Both companies invest in their worldwide presence. Airbus is a truly global enterprise with an active workforce of 55,000 around the world, while Embraer ended 2011 with 17,265 direct employees (Embraer Annual Report, 2011; Airbus, 2012).
The headquarters of Airbus are situated in Toulouse, France. The company's customer services department and those who are responsible for vital functions and decision-making within Airbus are also based there. In addition, the most significant departments, such as finance, engineering, design, operations, planning, procurement, customer relations, communications and marketing, are situated within the headquarters of Airbus (Airbus, 2012).
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The Embraer’s headquarters are based in the city of São José dos Campos, São Paulo, Brazil, where the Eugênio de Melo and ELEB units are also established (Embraer Annual Report, 2011). Embraer's headquarters is in charge for designing, manufacturing and providing after sales support to the commercial, corporate and military aircraft market. In the Eugênio de Melo unit are situated departments responsible for aircraft engineering, employees’ development and training activities. ELEB Equipment LTDA provides global support and maintenance through service centers in Europe and the United States (Embraer, 2012). Besides its units in Brazil, the company’s activities are carried out in administrative and industrial facilities in the United States, France, Singapore, China and Portugal (Embraer Annual Report, 2011).
Airbus owns subsidiaries in the Middle East, Japan, China and in the United States. Spare parts centers are situated in Hamburg, Frankfurt, Dubai, Washington, Singapore and Beijing, while training centers are in Toulouse, Hamburg, Beijing and Miami. In addition, there are more than 150 field service offices situated worldwide. Its industrial network includes a regional design office in North America, engineering centers in China and India, joint venture engineering center in Russia. There is also a network of some 1,500 suppliers in thirty countries that closely cooperate with Airbus (Airbus, 2012).
Embraer’ factories are also established in the cities of Gavião Peixoto and Botucatu. Abroad, the industrial facilities are based in the United States, Portugal and China. There are offices in the United States, France, the United Kingdom, China and the United Arab Emirates, which execute various administrative, commercial and marketing activities (Embraer Annual Report, 2011).
In the past, aircraft manufacturing companies marketed their services directly to their related partners in the industry. They often consulted trade publications to learn more about potential opportunities that may be available to them.
These days, however, Internet marketing for aircraft manufacturers is a more effective instrument for communication. Instead of performing cold calls in order to sell more engines, a corporate website can provide key information around the clock for those who are in need of them. A website can advertise the key features of a diverse product range.
Video commercials have also become one of the effective instruments for both companies to share information about the cutting-edge technology or recently manufactured aircraft.
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Nevertheless, a flying display is another way to reach out the potential customer. It is an activity which is deliberately performed in order to provide an exhibition or entertainment. This advertising event is open to the public. The flying display allows to demonstrate the technical capabilities of exhibiting companies’ aircraft (Airbus, 2012; Embraer, 2012).
The commercial aircraft market is being affected by passenger demand for air travel, cargo activity, regulation on national and international level, economic growth and the availability of aircraft financing sources. Delivering strong results in a sustained manner is the primary goal of both Airbus and Embraer. The Table and Bar Graph below compare the companies’ performance in the sector of aircraft delivery (Embraer, 2012; Airbus, 2012; EADS Financial Statements, 2011).
In terms of sales, Embraer’s turning point was the Farnborough International Airshow that took place in the United Kingdom in July 2010. The largest order was placed by Britain’s Flybe that ordered 140 aircraft for a total value of US$5 billion. This event has reinforced company’s image as a competitive aircraft supplier (Embraer Annual Report, 2011).
Meanwhile, Airbus received its biggest order made by the country’s largest full-service carrier in August 2012. Philippine Airlines (PAL) has placed a firm order of 54 aircrafts, whose delivery will start in 2013 (Airbus, 2012).
Since its foundation, Airbus has received orders for 11,479 commercial aircraft from approximately 334 customers around the world. It is the largest supplier of commercial aircraft in the world for the ninth consecutive year, since its deliveries in 2011 have compounded 534 aircraft. Airbus received 1,608 gross orders in 2011, while in 2010 this number consisted only of 644 (EADS Registration Document, 2011). Airbus jetliners have become the aircraft of choice for airlines worldwide. High comfort and versatility are the pivotal features of the company’s passenger aircraft. Furthermore, the innovative, double-deck A380 has revolutionized the way of travelling. There are no doubts that the new-generation aircraft family, which is being developed relying on the thirty years of Airbus’ experience, will shape the future of air travel again (Airbus, 2012).
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Embraer has more than ninety customers worldwide. Therefore, this international scope reflects the quality of airplanes. More than 30 airlines operate the regional jets that were delivered by Embraer. While the 37 to 50 seat segment aircraft deliver passengers from small cities to main flights in larger airports, the 70 to 120 seat E-Jets help in maintaining the competitive edge of the in airline companies (Embraer, 2012).
The distinctive feature of corporate jets designed by Airbus is the most diverse choice of spacious and widest cabins. Customers can select the size and level of comfort from the wide range of company’s jets from the ordinary to double-deck aircraft. In business aviation Airbus operates a large base of customers located all around the world, which makes it a worthy and far-reaching investment (Airbus, 2012).
In 2000 Embraer launched the product line targeting the business aviation market. The jets have quickly gained the popularity due to their comfort, outstanding performance, simple maintenance and low operational costs. The executive jets delivered by Embraer are designed to meet all the customers' needs. Such manufacturing policy and commitment contributes to the satisfaction of the clients and, therefore, their loyalty to the aircraft manufacturer (Embraer, 2012).
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Airbus military aircraft covers mission performance that range from light tactical transport to aerial refueling and strategic force projection. The key words for operational success are ability of the aircraft to perform airlift, deployment and support. A full range of missions is being covered by Airbus’ military aircraft. It also includes tactical transportation by the multi-role airlifter or the Multi Role Tanker Transport (Airbus, 2012).
Embraer's military aircraft not only provide advanced and superior mission performance but also meet the budgetary requirements of defense programs around the world. Before launching the manufacturing process, Embraer thoroughly assesses the customers' needs. While the ground conditions are often inconvenient, maintenance materials are scarce and pilots usually return to base on severely damaged aircraft, Embraer’s defense aircraft are designed to meet these challenges. Therefore, the company’s performance is highly appreciated by the pilots and ground crew. The key features of the military aircraft designed by Embraer are the cutting-edge electronics, high reliability alongside with outstanding mission effectiveness (Embraer, 2012).
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Delivering aircraft of high quality on time is the number one priority for every aircraft manufacturer. Embraer considers the safety of its products to be a question of ethics. Product safety is the fundamental pillar of company’s excellence and sustainability, which is essential for its competitive edge. For that reason, employees are encouraged to report any risk situation in order to implement necessary changes and meet the safety recommendations (Embraer Annual Report, 2011).
Before ordering the aircraft, every airline examines its safety, reliability, comfort and maintenance costs. In order to achieve the strictest standards on quality, Airbus conducts specific checks and tests at every stage of the manufacturing process. It is crucial to identify problem in order to eradicate it and avoid awful consequences. Aircraft must undergo more than thousand hours of test flying before achieving its final type certificate. Airbus also contributes to improving safety standards worldwide, whereas it should not be a matter of competition in the aviation industry (Airbus, 2012).
The key success factor for the aircraft manufacturer is the ability to listen to its customers and to implement everything they need. The aviation industry is not a one-way influence. Customers and manufacturer are closely interconnected; therefore, the performance of one of them directly depends on the others.
While designing the aircraft, Airbus has proven to keep the needs and views of customers in mind. When buying an Airbus aircraft, customers are guaranteed to receive quality and after-sales support.
The pivotal role of Airbus’ customer service lies in helping them to operate the aircraft safely and profitably in order to satisfy their passengers comprehensively. All areas of support are being covered by a team of three thousand specialists 24 hours a day, 7 days a week. These areas include technical issues, aircraft upgrades, spare parts maintenance and even crew trainings. In addition, some of these professionals are located close to the airlines deliberately to perform an upscale customer service (Airbus, 2012).
The Embraer’s customer service also is focused on delivering the best and prompt help when needed. Its strategy relies on anticipating and forecasting the potential problems that may arise. Thus, in case something happens, the company has already prepared itself to similar threat and while the crisis evolves, Embraer’s customer service is aware of actions that need to be implemented in order to deal with this specific problem. As a result, the aircraft manufacturer is characterized as reliable and attractive to the customers. The excellent performance involves providing Embraer’s customers with an outstanding product package, which includes a comprehensive and qualitative support once the aircraft was bought. Each of the Embraer’s authorized service centers is strategically located with a purpose to conveniently perform aircraft warranty services throughout the world (Embraer, 2012).
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Both, Airbus and Embraer adhere to the policy of high class performance delivering the ordered aircraft on time, at reasonable cost and of top quality and doing this in a proper manner from the very first time.
Air travel has always been at the heart of international economy. The aircraft manufacturing industry is one of the few that is truly worldwide. The sector of aviation is constantly expanding. Every fifteen years the passenger demand doubles. It is estimated that it could be handling annually around 16 billion passengers alongside with 400 million tonnes of cargo by 2050 (Airbus, 2012).
Nowadays, each aircraft is designed with the needs and views of customers in mind. Airbus occupies the industry-leading position, while Embraer is the third largest supplier of commercial jets. The performance of both companies reflects the highest level of quality and safety of the delivered products. Therefore, reliability is the ultimate goal of the aircraft manufacturing process for it creates perfect conditions for customers’ loyalty.
In order to thrive in the modern aircraft market, the range of products must be comprehensive. Airbus and Embraer realize the significance of developing and offering innovative technologies on a continuing basis. Aftersales support and maintenance is pivotal for the effective customer service as well.
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Lately, passengers have become increasingly aware of the ecological impact of their travel choices. Both companies listen to their customer’s needs. Airbus and Embraer develop various activities to reduce the environmental impact of air transport, conduct the alternative fuel research contributing to environmentally sustainable development and health promotion.
Constant development of innovations and their implementation guarantee the company’s competitiveness in the market. Both Airbus and Embraer invest into the research and development, whereas it is essential for every manufacturer willing to succeed and meet the growing demand for a new generation of aircraft. Therefore, setting even higher standards in quality of improvements is critical to maintaining success of the company.