Canadian Defence Review

December 5, 2015

AIAC event participants give nod to Bombardier help
The Quebec government’s $1 billion investment in Bombardier’s C-Series draws support at the Canadian Aerospace Summit.

The world’s leading aerospace manufacturers, buyers, politicians and other cluster stakeholders gathered in Ottawa in November for Canadian Aerospace Summit. The growing two-day event once again attracted record crowds, amidst controversy surrounding rumors that Bombardier was now asking for federal assistance, following the recent announcement of the Quebec government’s $1 billion cash injection.  

The troubled aircraft manufacturer however drew surprising support at the Aerospace Industries Association of Canada event. “Aerospace is a high-value added industry that is expected to grow rapidly in coming years,” said Jim Quick, the organization’s chief executive officer. “Bombardier is competing against several national champions in other countries that get significant government support. It’s not surprising that they should want a level playing field.”

Ross Mitchell, Bombardier’s vice-president (commercial aircraft), was also quick to come to his employer’s defence. At an opening day presentation Mitchell, who projected that 23,000 new commercial aircraft would be bought worldwide during the coming two decades, announced that flight testing on the company’s C-Series model had just ended, and that certification was “imminent.”  The rescue of Bombardier, one of the Canada’s aerospace sector’s largest players, is thought by many to be also crucial to the defence sector’s ongoing success, due to the broad overlap in supply chains that include local contractors who depend on both industries for business.  

Next generation fighter and FWSAR
Summit participants were also rubbing their hands at the Liberal Government plans, which were outlined in Prime Minister Justin Trudeau’s mandate letter to Defence Minister Harjit Saijan, to launch an open competition to replace Canada’s aging CF-18 fighter aircraft. Jeffrey Johnson, a vice-president at Boeing Military Aircraft for example noted that he was “confident” that production of the F/A Super Hornet, a possible FA-18 replacement, would continue at least five more years. Christian Scherer, head of Airbus Group International, for his part described the Eurofighter Typhoon as “an absolutely suitable replacement,” for the Royal Canadian Air Force’s existing fighter aircraft.

Canada’s plans to buy new Fixed Wing Search and Rescue Aircraft also continue to draw strong interest. Embraer for example dispatched Geraldo Gomes, its vice-president (international business development), to plead the case of its KC-390, which he bills as the only jet aircraft in the competition, an advantage that would speed SAR response times. Embraer, which has already sold 28 KC-390s to Brazil to do search and rescue work, would have to find a Canadian partner to fulfill PWGSC demands, notably to rebuild the nose, so that it could accommodate all of the sensors that will be required, and to meet other industrial and technical benefits requirements. Possible contenders include CAE and Pratt & Whitney Canada, both of which already do extensive work with Embraer.

Summit outshines Vegas event
The record turnout at the Canadian Aerospace Summit is somewhat of a surprise, given the weak economy, which is a key driver of aircraft demand. According to one participant, the event also does not appear to have been hampered by the NBAA 2015, a competing event that was being held at the same time in Las Vegas. One participant bemoaned the overlap, saying that it was the first time in decades that he had missed the Vegas event.

Irene Makris, vice-president (marketing) at Pratt & Whitney however had no reservations about favoring the Aerospace Industries Association of Canada trade show. “It’s a great event and we are really busy here,” she said, brushing off a local reporter. “In fact we are in the process right now of loading some additional people on a train so they can come to Ottawa for the second day tomorrow.”
 
It remains unclear how key trends stemming from economic sluggishness, such as falling energy prices, will affect Canada’s aerospace sector, which employs close to 180,000 people and contributes close to $29 billion to the country’s gross domestic product. At first glance, the weak loony, which has fallen from above parity with the US dollar, to the USD $0.74 range at press time, would appear to provide upside momentum to a sector, which exports close to 80% of its output. However as Raymond Leduc president of Bell Helicopter Textron notes, the trend also works both ways, as many of the sector’s inputs are priced in greenbacks.

The aerospace event was not without its lighter moments. John Maris, president of Marinvent for example, who took over as AIAC chair at the proceeding, provided one dash of humor: “I am still clinging to power after four hours in the post,” he asked passersby with a smile. “How am I doing?”


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