More government support for Quebec aerospace industry

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The Quebec government has moved once more to support the province’s aerospace sector, committing $250 million in direct aid toward expanding and diversifying the industry. Premier Philippe Couillard also promised an additional $260 million in loans and other financing arrangements. The investment is made with the expectation that it will generate up to $2.8 billion in spinoffs as Quebec’s nearly two hundred small and medium aerospace companies become “more international.” Approximately 40,000 people now work in aerospace in Quebec, and the industry has annual sales of $15.5 billion.

The crown jewel in Canada’s aerospace industry is, of course, Bombardier. Couillard called the company’s C Series aircraft, currently in development and recently given a major boost by large orders from Air Canada and Delta Airlines (though rival Airbus has said Bombardier offered the planes to Delta “for a song”), the most important project in Canada today. Whether that is “objectively” true as Couillard put it, or not, he expects Ottawa to contribute to the program. He has repeated frequently over the past several months that he expects Ottawa to dedicate the same energy and support to Quebec as was given to the auto industry in Ontario a few years ago.  His government has already put $1 billion into the C Series. Besides Bombardier, Quebec is home to Bell Helicopter, Pratt & Whitney Canada, and CAE, the full-flight simulator maker.

So far, the federal government’s support has been mostly verbal. Finance Minister Bill Morneau said in Japan at the G7 finance ministers’ meeting that aerospace, and Bombardier in particular, fit “right in our bull’s eye” when it comes to industries worthy of federal support. Morneau praised the industry for being highly innovative and having the potential to grow, adding that focusing on “world-leading companies and world-leading technologies” makes sense for the government. The prime minister has also praised the C Series aircraft.

Meanwhile, the federal government announced last week a relatively modest investment of just over $500,000 to support the aerospace and defence industry in western Canada. The money is to support the Aerospace Industries Association of Canada (AIAC) and its presence at a number of international trade shows. One of these, the 2016 Aerospace Defence & Security Expo, the largest such trade show in western Canada, will receive $75,000. These industry events are seen as “critical” to the sector as they provide opportunities for western Canadian companies to enter the international market.

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