If you ask a Brazilian “who invented the airplane” you may be surprised by the answer. This is because most Brazilians attribute that distinction, not to the Wright Brothers, but to Alberto Santos-Dumont. Dumont flew a biplane for a distance of 60 meters before a crowd of Parisians in the fall of 1906. It was the first documented flight in the world and while the Wright Brothers did fly at Kitty Hawk in 1903, in 1906 they were not very well-known.
Santos-Dumont is considered to be the “Father of Aviation” in Brazil with the regional airport in Rio de Janeiro named after him. In 1908, the Wright Brothers demonstrated their flying machine in Paris before the world record sanctioning body and it flew further and better than any airplane built at that time. The point here, however, is not to present arguments in favor of Santos-Dumont as the first man to successfully operate a self- powered aircraft; rather, it is to draw attention to the fact that Brazil, known mostly for its Samba, football (soccer) prowess, and Carnival, is actually one of the world leaders in technological and scientific achievement and has historical precedent as evidence.
The aerospace sector requires considerable technological and management know-how to develop. Emerging superpowers such as China are very keen to develop their aerospace industry while India has set a goal to fly to the moon as a crowning achievement to its remarkable economic growth and development in the past decade. While India and China are still in their early stages of development, Brazil can boast having the fourth largest aerospace industry in the world.
The aerospace sector in Brazil is dominated by the Empresa Brasileira de Aeronautica, Embraer SA. The company was launched by the government in the late 1960’s. It has now become the third largest maker of commercial aircraft and the fourth largest maker when considering its production of business and private aircraft. Embraer served the Brazilian domestic markets only until 1975. Since then, the company, based in San Jose dos Campos, has sold hundreds of aircraft to airlines all over the world, while carving a large slice of the international business jet and military aircraft markets.
Embraer has become one of the companies driving the aircraft industry and it is a leading proponent of new technologies, competing against Bombardier of Canada as well as Boeing and Airbus in the small passenger jet markets. Embraer may have started as a nationalist import substituting industrial project, but it has earned its place in the world through the market system, producing world class aircraft that address the needs of customers in all six continents. While the Chinese government has been stimulating its own domestic aerospace industry, this effort is still far from being rewarded by the market and can only be sustained through heavy Chinese government support.
Embraer is s symbol of Brazil’s emergence as a world power. The company has become large enough to require manufacturing outposts outside Brazil to address increasing demand in Europe.
Brazil’s technological prowess is evident in its relationship with Portugal, the former metropole. Whereas 500 years ago Portuguese sailors settled in what is now Brazil, establishing their largest colony, Embraer has constructed a facility in Evora, Portugal, helping the Portuguese aircraft industry take off in its own right. Embraer will make composite and metallic parts, including wings, for its latest Legacy series of business jets. Six years ago, Embraer invested in the Portuguese aircraft maintenance company OGMA. Embraer will expand its Portuguese operation to produce the KC 390 airlift airplane, which is on order by the Portuguese air force. The Portuguese aerospace industry has struggled to grow and Embraer’s investment could act as the catalyst for further development.
Thanks to investments from Airbus, Portugal’s neighbor Spain has seen its aerospace sector develop significantly in the past 20 years, which has helped boost a series of high technology suppliers. Indeed, Spanish contractors are eagerly expecting to get contracts from Embraer’s Portuguese division, while Portuguese suppliers acquire the necessary expertise. Embraer has indicated a willingness to ‘cultivate’ the budding Portuguese aerospace industry with the understanding that few Portuguese companies have the ability to provide the over 1,000 parts that Embraer intends to contract out to third party suppliers. Embraer expect to invest at least 150 million euro in the local economy generating an initial 600 jobs, which should grow to 2,000.
Cynics might insinuate that colonial ties and a common language were primary factors in the Portugal-Embraer relationship. However, the Brazilian aircraft maker has proven itself against American and European firms in international markets for years now. Lately, Embraer has had great success with its ‘Tucano’. It is a single engine turboprop, designed for pilot training, which has been ordered by governments worldwide; most recently by a few African governments. The confirmation of the Tucano’s success has come as the US Air Force has chosen it against domestic competitors to supply the US trained Afghan air force. The contract suffered setbacks after complaints from American suppliers and a revision of the tender specifications; however, Embraer’s offer is expected to prevail, especially because Brazil can retaliate by awarding a billion dollar fighter jet contract, originally intended for Boeing, to a European or Russian contractor (for the record, Embraer does not produce large jet fighters).
The Brazilian government has no doubt facilitated Embraer’s sales to such countries as Mauritania, Angola and Burkina Faso, all of which would present some Congressional obstacles for US manufacturers. Nevertheless, Embraer has also won the tenders thanks to the Tucano’s low cost in relation to capability.
Embraer has grown into a world-class aircraft company offering advanced products that meet or exceed specifications in each market segment. The company has benefited from international collaboration, having assimilated technological solutions from the world’s best over the past few decades.
Ultimately, Embraer has had success in the market and the company should serve as a model for any country intending to develop a domestic aerospace industry. This is an important consideration in view of the billions of dollars being spent by China and India in doing just that. Embraer aircraft such as those of its E-Jet regional jet series are the market leader worldwide in their segment. Embraer has also been careful not to compete in segments saturated by supply from Boeing and Airbus, focusing on areas where it had a competitive advantage instead. In this sense, Embraer pleases accountants as well as engineers. The company is also on the leading edge of technology, collaborating with Boeing, Airbus and Bombardier on the development of bio-fuels for use in aircraft and the use of the latest composite materials. Embraer was privatized in 1994 and it trades on the NYSE under the symbol ERJ.