EMBRAER - KC - 390

Ashwin

Agent_47
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Nov 30, 2017
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Neither will UK nor will the US allow either RR or GE to sink much less allow India a stake leave alone a controlling one at that. These are crown jewels of both nations. Ever since UK allowed the ToT of jet engines to the former USSR under Atlee in the late 40's only to deeply regret it, they've derived the right lessons & aren't going to repeat it ever.
Yup, too much fan fiction.
 

Gautam

Team StratFront
Feb 16, 2019
11,139
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Tripura, NE, India
Advantage India, I'd say if we play our cards right. No way US or Europe is going to support this bid of China.
This. Market access to the West is a necessary part of Embraer's business. US is argueably the single most important market for the Brazilian company. Given the state of US-China relations, Embraer will lose access to US and probably European market too in case of a Chinese acquisition.
Chinese will outbid us unfortunately. Only hope is western countries threatening their ties with Embraer
Chinese govt. ? May be. But if it is up to Indian companies not the Indian govt. then the situations are a lot different. Indian companies have stolen many deals from under the nose of the Chinese globally. Most recent example was the acquisition of Norton Motorcycles by TVS just 2-3 months back. If Indian companies get GoI's backing and the threat of Western sanction looms in case of Chinese acquisition, I would say this is a done deal. Let's see.
 

_Anonymous_

Senior Member
Dec 4, 2017
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This. Market access to the West is a necessary part of Embraer's business. US is argueably the single most important market for the Brazilian company. Given the state of US-China relations, Embraer will lose access to US and probably European market too in case of a Chinese acquisition.
It's not so much as market access in Europe or the US than the supply of vital sub systems & components to Embraer that will be at stake if the deal with the Chinese goes thru. Let's face it, in the pre Chinese virus era the maximum aircrafts being procured was from outside the US & Europe. Boeing specifically initiated the take over of Embraer to essentially compete with Airbus's take over of Bombardier thus filling up the need for a particular class of aircraft in it's portfolio. For Embraer it was about getting out of the debt trap, access to the vast markets that Boeing has access to courtesy it's even more grand marketing clout & deep pockets. Identical reasons why Bombardier chose to go in with Airbus.

Chinese govt. ? May be. But if it is up to Indian companies not the Indian govt. then the situations are a lot different. Indian companies have stolen many deals from under the nose of the Chinese globally. Most recent example was the acquisition of Norton Motorcycles by TVS just 2-3 months back. If Indian companies get GoI's backing and the threat of Western sanction looms in case of Chinese acquisition, I would say this is a done deal. Let's see.
This deal can only be undertaken by a consortium of Indian companies a sort of PPP with the GoI serving as the guarantor & prime mover of the deal apart from facilitating preferential market access in both the civil & military sectors as a pre condition to sweeten the deal for the proverbial JV as & when it materializes. Otherwise it's a non starter.
 
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Gautam

Team StratFront
Feb 16, 2019
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Let's face it, in the pre Chinese virus era the maximum aircrafts being procured was from outside the US & Europe.
Procured yes. India being one of the largest buyers. Most of the civvie aircrafts being procured were from Airbus or Boeing. Embraer is yet to sell much of anything to India & most of the world. Their business jets are sold mostly in the US and Europe, there aren't a lot of takers for those in the developing world. Their trainers are being sold to many militaries, including the US. Since they didn't have a viable product in the civilian space yet, most of their markets were restricted to niches of the aviation market. This is not the same as with Airbus or Boeing, thus unlike the big 2 Embraer relies heavily on the US market. Of course the point you make about sub-systems and components is very true.
This deal can only be undertaken by a consortium of Indian companies a sort of PPP with the GoI serving as the guarantor & prime mover of the deal apart from facilitating preferential market access in both the civil & military sectors as a pre condition to sweeten the deal for the proverbial JV as & when it materializes. Otherwise it's a non starter.
Agreed.
 

_Anonymous_

Senior Member
Dec 4, 2017
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Procured yes. India being one of the largest buyers. Most of the civvie aircrafts being procured were from Airbus or Boeing. Embraer is yet to sell much of anything to India & most of the world. Their business jets are sold mostly in the US and Europe, there aren't a lot of takers for those in the developing world. Their trainers are being sold to many militaries, including the US. Since they didn't have a viable product in the civilian space yet, most of their markets were restricted to niches of the aviation market. This is not the same as with Airbus or Boeing, thus unlike the big 2 Embraer relies heavily on the US market. Of course the point you make about sub-systems and components is very true.
Embraer didn't sell anything in the civil aviation sector not because they didn't have a good product or a lacunae in their product portfolio just that the Indian civilian airliners had a long established relationship with either of the 2 majors. The same would be true of any prospective client anywhere in the world.

You see in the field of capital goods purchase, comfort levels are very important. People just don't get up one fine day & change their suppliers. That usually happens in case of irreconcilable differences for some reason viz : financial disputes, bad product & customer support or a change in the political situation.

Likewise one would consider a new vendor only if that organization has something substantial to offer viz : an outstanding product which the current crop of vendors lack &/or a very good offer - neither of which conditions Embraer could satisfy. To begin with the first conditions I've listed didn't materialize . It's only when that happens that the second set of conditions come into play.

On the contrary, I would say in case of biz jets the market for such jets in the developing world is bigger & more diverse than the US & Europe.
 

Gautam

Team StratFront
Feb 16, 2019
11,139
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Tripura, NE, India
Embraer didn't sell anything in the civil aviation sector not because they didn't have a good product or a lacunae in their product portfolio just that the Indian civilian airliners had a long established relationship with either of the 2 majors.

You see in the field of capital goods purchase, comfort levels are very important. People just don't get up one fine day & change their suppliers. That usually happens in case of irreconcilable differences for some reason viz : financial disputes, bad product & customer support or a change in the political situation.

Likewise one would consider a new vendor only if that organization has something substantial to offer viz : an outstanding product which the current crop of vendors lack &/or a very good offer - neither of which conditions Embraer could satisfy. To begin with the first conditions I've listed didn't materialize . It's only when that happens that the second set of conditions come into play.
So......pretty much what I was saying. What are we debating ? :p
On the contrary, I would say in case if biz jets the market for such jets in the developing world is bigger & more diverse than the US & Europe.
How so ? Aren't they mostly for corporates ? Developing world has less number of corporates, doesn't it ? I am not sure if modified biz jets turned to AEW&C and ELINT aircrafts will sell in enough numbers to make a dent.
 

_Anonymous_

Senior Member
Dec 4, 2017
11,723
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Mumbai
So......pretty much what I was saying. What are we debating ? :p



Since they didn't have a viable product in the civilian space yet, most of their markets were restricted to niches of the aviation market.
How so ? Aren't they mostly for corporates ? Developing world has less number of corporates, doesn't it ? I am not sure if modified biz jets turned to AEW&C and ELINT aircrafts will sell in enough numbers to make a dent.
I was referring to the immediate future. In the present, it's still dominated by the US & Europe. China & the Gulf are coming up very fast. But of course, this is all pre Chinese virus market scenarios.
 

TARGET

Active member
Dec 2, 2017
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GOI shouldn't buy it, rather support private aerospace industries like Mahindra Aerospace and Tata Aerospace to acquire this company, Selling the public sector unit already a pain in the axx . Prior to acquisition, GOI should approve the orders for immediate relief and also we should know the percentage of IP rights hold by Embraer on their aircraft.