1. EMSK – For the Future
“More than a joint-venture: a
effort to promote innovation”
Project of Korean & Global economy
2013 - April 29th
Murilo dos Santos – ID 50131038
murilo077@gmail.com

2. • BLUF
• Brazil and Korea data
• About the members – Embraer & SK
Innovation
• Commercial aviation industry
• PEST Analysis
• Conclusion
Presentation Topics

3. BLUF • EMSK: Embraer +
SK Innovation
• Joint-venture to
promote R&D
• Main goal:
Reduce
emissions
• New Materials
• Aircraft
components -
Battery & fuel
components

4. Brazil
GDP (PPP) US$2.362 trillion
GDP by Sector
Agriculture 5.4%
Industry 27.4%
Services 67.2%
Population 201,009,622
Age structure
0-14 years 24.2%
15-24 years 16.7%
25-54 years 43.6%
55-64 years 8.2%
65 years and over 7.3%
Per Capita GDP US$12,000
Work Force/Pop Ratio 53,28%
Poverty Rate 21.4%
Gini Index 51.9
FX & Gold Reserves US$371.1 billion
External Debt US$405.3 billion
Key-industries: Textiles, shoes, chemicals,
cement, lumber, iron ore, tin, steel, aircraft,
motor vehicles and parts, other machinery
and equipment.

6. • Petrobras (US$161B)
• Bradesco* (US$83B)
• Itaú Unibanco* (US$73B)
• Banco do Brasil* (US$72B)
• Vale (US$55B)
Brazil – Top 5 Companies
Obs: US$ Billions / Based on the revenues obtained in 2011
*Banks

7. Brazil – Top 5 Without Banks
• Petrobras (US$161B)
• Vale (US$55B)
• Odebrecht (US$37B)
• JBS (US$34B)
• AmBev (US$28B)

8. Korea
GDP (PPP) US$1.611 trillion
GDP by Sector
Agriculture 2.7%
Industry 39.8%
Services 57.5%
Population 48,955,203
Age structure
0-14 years 14.6%
15-24 years 13.6%
25-54 years 47.8%
55-64 years 11.7%
65 years and over 12.3%
Per Capita GDP US$32,400
Work Force/Pop Ratio 52,10%
Poverty Rate 16.5%
Gini Index 41.9
FX & Gold Reserves US$326.9 billion
External Debt US$413.4 billion
Key-industries: Electronics, automobile
production, chemicals , shipbuilding, steel.

9. • Samsung Electronics
• SK Holdings
• Hyundai Motors
• POSCO
• LG
Korea – Top 5 Companies

10. • Brazil: 3 banks in Top 5 companies
• Korea: Top 5 with high-tech companies
• Korea: ¼ of the Brazilian population but more
than ½ of its GDP
• Korean per capita GDP its almost 3 times the
Brazilian
• Korean international trade its more than 2 times
the Brazilian
• Close numbers in External debt and reserves
Findings

11. • Core business: aircraft manufacturing
• Founded by the Brazilian government in 1969
• Privatized in 1994

12. • Total revenues (2011):
5.8 US$ billions
• 19th in the aerospace
manufacturers
• 55th between the
companies operating in
Brazil
• Commercial and
executive jets: 81% of
revenues
Executive
14%
Defense
18%
Commercial
67%
Others 1%
Embraer - Revenues by Sector

13. • 5th in revenues between commercial aircrafts
manufacturers
• Highest growth in revenues 2010/2011 on this segment

14. • Energy & Chemicals
• Information,
Telecommunication &
• Semiconductor
• Marketing & Service
• Revenues (2012):
US$ 100 Billions

15. • Energy, chemicals &
lubricants
• Overseas Resource
Exploration & Production
• Battery Business
• Information & Electronic
Materials Business
• Revenues (2011): US$
62 Billions
Subsidiaries:

16. • Intensive in technology
and capital
• Perspective of growth
for the next 20 years
• Asian market (mainly
China)
• New demands
Oil consumption
Emissions
• New competitors on
Embraer main segment
Aeronautic Industry

17. http://www.youtube.com/watch?v=wBPY34jCmos

19. Commercial Aircraft Manufacturing
- Competitors

20. Forecast – Commercial Aviation

21. • Political Stability
• Korean government
wants to promote a
knowledge-based
development
• Power of Chaebol
• Intention to approach
with Brazilian
government
• Opportunities
- Cooperation of both
BR and KR
governments
• Threats
- Historic of huge
intervention
- Popular pressure to
decrease benefits to the
big business groups
Korea: Politics

22. • Right level of income
• Right level of GDP
• Increasing of
household debt
• Suffering to recovery
due to international
scenario
• Financial market
• Threats
- Increase of difficult to
borrow money
- SK support could be
compromised
• Opportunity
- Labor force can
become cheaper
- Korean economy is
relatively robust
Korea: Economy

23. • Families are really
concerned about
education
• High quality of
education
• Experience with high
technology
• Growing appeal of
high speed rail (HSR)
• Opportunities
- Qualified labor force
- HSR growth can drive
air companies to rethink
their fleets
• Threat
- Aging population can
create difficulties to hire
new employers
Korea: Society and Technology

24. Conclusion
- Good opportunity to exchange know-
how
- Possibility of cost reductions
- Near to the Chinese market
- Qualified labor force
- Possibility of resources from the
governments of both countries

25. Difficulties of a partnership in
R&D
- Possibility to give to the other part the
tools to became a rival in the future
- SK group already has many resources
and activities in different sectors

26. EMSK – For the Future
“More than a joint-venture: a
effort to promote innovation”
Project of Korean & Global economy
2013 - April 29th
Murilo dos Santos – ID 50131038
murilo077@gmail.com