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Canadian aerospace industry braces for competition from India and China

February 02, 2012 Written by 
The term “industry cluster” resonates in the hi-tech world, with famous examples of California’s Silicon Valley and South Korea’s Digital Media City jumping to mind.
But who knew that Canada boasted the world’s number three aerospace industry cluster in Montreal, right behind Toulouse and Seattle? 

Federal Industry Minister Christian Paradis pointed this fact out at a recent aerospace conference that tackled strategies in this competitive arena. The conference also was told that emerging powers like China and India will eventually compete in aircraft manufacturing – but it might take a while.

The head of one industry think-tank noted that Hindustan Aeronautics Limited, India’s state-owned company, is heavily involved in building helicopters and plans to eventually develop its own fighters and commercial aircraft, noted Peter Rakobowchuk of The Canadian Press.

But Suzanne Benoit, CEO of Aero Montreal, added that India still has some catching up to do.

“It’s not really a commercial company, it’s a government-owned company so maybe the pace of development may not be as fast as other air framers, Benoit said.

“It’s not going to happen tomorrow, but you never know in India – the government may decide to put a lot of money into it.”
Benoit made her comments at a two-day forum on aerospace innovation organized by Aero Montreal, a think-tank for Quebec’s aerospace sector.

She stressed that, while the Chinese are also developing their own industry, Canada is still strong when it comes to aircraft innovation, concept and design.

“What we have to remember is (that’s) where the market will be in the future and I don’t think it’s a bad thing because our companies will sell to them,” Benoit added.

But she says Canada can’t sit back and relax – even though she thinks it may take 15 to 20 years before the Chinese aircraft industry takes off.

“We can’t sit on our laurels because the two emerging nations have an enormous number of engineers graduating,” Benoit noted.

“I would say in India, 300,000 engineers a year graduate and there's also an enormous number in China.”

Rod Jones, the executive-director of the Ontario Aerospace Council, agrees with Benoit that China will be a full player.

“We see them mostly active in their own market,” he said. “But China is bent on building its own aerospace industry and, in the long run, the opportunities are like in 10 to 15 years.”

Minister Paradis says the Canadian aerospace industry can’t let up.“The best way to fight is to just keep pushing where we are strong,” he told reporters after a luncheon speech.

“We have to demonstrate that we have the best products, that we have the products of the future and that we have the skilled labor.”

Paradis boasts that Montreal ranks as the third-largest aerospace cluster in the world after Toulouse and Seattle.

“We are the leaders here so we have to keep pushing on this because this is a good industry with a promising future,” he said.

Canada’s aerospace and space sectors generate annual revenues of over $22 billion and employ nearly 80,000 Canadians in more than 400 firms across the country.

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