Massive Push In Asian Markets By Brazilian Airplane Manufacturer Aimed Toward Globehopping Businesspeople In Business Centers#
The Wall Street Journal writes today that Embraer, the Brazilian aircraft manufacturer, is focusing new marketing efforts directly on Asian markets, hoping that the rapidly emerging luxury market -- and growth in the business sector -- will boost its long-term prospects in the private jet segment. As the article points out, the key Asian market in which Embraer hopes its planes to catch on is Hong Kong, where easier travel access, a more global business sector, and highly mobile executives could add up to increased sales. Recently, on a globe-hopping promotional tour, Embraer took execs on a quick jaunt from Hong Kong to nearby Macau, one of the most popular weekend trips for Hong Kong's business elite.
Asians who primarily made their fortunes in low-cost manufacturing are increasingly clamoring for access to luxury goods and services, including business and personal travel. Embraer is focused on Hong Kong in particular, which because of its proximity and robust infrastructure, serves as the main platform for business people traveling to and from mainland China.
According to a study by the Boston Consulting Group released this month, the number of millionaire households in China could double by 2013, to 788,000, after nearly tripling between 2003 and 2008.
While private airplanes are a luxury few will be able to afford in Asia, the Chinese market, with its growing number of millionaires -- many of whom travel domestically on a weekly basis and may see the ability to hop in their private jets for weekend trips between Beijing and Hong Kong -- south China, Macau, and Hong Kong seem like great targets for the company. With China's manufacturing base residing in the Pearl River Delta region of Guangdong, China's global financial center still in Hong Kong (though Shanghai is nearly even at this point), and high-powered businesspeople in these regions often popping over to Macau for gambling getaways, Embraer has a real chance to gain a strong foothold in the region.
Despite the company's renewed push into Asia, Embraer is no real stranger to China, having set up a joint venture in northeast China's Harbin City in 2002 to build commercial aircraft. By building on its commercial success in these mainland market and heavily promoting the convenience of its private jet lines, Embraer has the potential to become one of the most profitable airline manufacturers in Asia and a strongly equitable brand name in the burgeoning mainland China market.