New Government Mandate Brings Opportunity for Renewed Partnership

As we approach 2022, almost two years into the COVID-19 pandemic, and with a re-elected Liberal minority government in place, now is the time to ensure Canada is positioned to take advantage of what we are told will be significant global aerospace opportunities.

During the federal election campaign, as part of AIAC’s numerous advocacy events featuring the candidates, we were very pleased to hear all major parties acknowledge the need for a national strategy that includes specific measures for civil, defence, and space.  

Additionally, during the campaign AIAC worked with Nanos Research to conduct a national public opinion poll which found, among other things, that a vast majority of Canadians also support government action to keep the industry globally competitive. Coming out of COVID-19,  there is no better time for a Canadian Aerospace Strategy built on a renewed industry-government partnership.

The question we put to all parties is simple, is Canada prepared to ensure our world-leading legacy in aerospace is preserved for future generations?  If the answer is yes, Canada needs a national aerospace strategy that looks to 2050, defines our role in the global marketplace, and sets out a clear roadmap.

Aerospace is entering a new era of transformational growth. Post-pandemic growth will be fueled by a green revolution, the race to decarbonize flight, global defence procurements and partnerships, pent-up demand for travel, and the trillion-dollar future of space exploration.

As an R&D and productivity leader, Canada’s aerospace industry offers a best-in-class example of how modern Canadian manufacturers can innovate and help grow our national economy to contribute to stronger communities across the country and strong exports around the world.

Eighty years ago, in a visionary act of nation-building, our political and industry leaders decided to make Canada an aerospace nation. That partnership paid huge returns as Canada grew to become the 5th largest aerospace industry in the world, responsible for supporting 235,000 jobs in every region of the country. Failing to prioritize Canada’s pursuit of leadership in aerospace, ignores several realities.

First, unlike most other industries, the strategic, export-intensive nature of Canadian aerospace positions it to be a major driver of Canada’s overall post COVID19 economic recovery.

Second, all of the other countries with which Canada competes have strong, government-industry partnerships and are implementing national sector plans.

Finally, significant effort has built up Canada’s aerospace legacy and hundreds of thousands of jobs in every region of the country are dependent on its continued success. Every other top aerospace nation  – including the United States, the UK, France, Germany, and Australia – is looking to the future, implementing sector and industrial strategies to compete and win in the emerging multi-trillion-dollar cleantech aerospace market. Canada needs to move now with its own strategy if we are to keep our Canadian jobs and industry strong for the future.

COVID’s impact on aerospace and defense was immediate and profound; aircraft were parked, there were disruptions in production lines, financing challenges for small- and medium-sized businesses, and MRO slowed right down.  However, a full recovery is within reach and the Canadian aerospace industry has a real opportunity to contribute to Canada’s economic recovery.

As the industry moves towards this recovery, emerging technologies bode well for the future. Especially considering that Canadian aerospace has always been a future-facing industry with world-leading inventions like the Canadarm, still used in space and revolutionizing advanced manufacturing around the world.

The greening of aviation,  the rise of commercial space activity, and unmanned aerial systems, and are just a few of the opportunities that lay ahead. However, the support of policy makers is imperative to industry’s efforts to capitalize on them.

Because of the singular and strategic nature of aerospace and the broad applications of its technological advancements, in every aerospace nation, the industry has always depended on a close partnership with government.  We need only to look to the United Kingdom to see how a shared vision between industry and government – and a clear strategy – can support growth and jobs. 

In 2010, the Aerospace Growth Partnership (AGP) was established as a strategic partnership between the UK Government, industry, and other key stakeholders, to secure the future of the UK aerospace industry. As a result, the UK aerospace industry saw incredible gains.  Canada does not need to reinvent the wheel, we have examples internationally and we have a roadmap for a strategy here in Canada that began when AIAC launched the Vision 2025 initiative that includes clear and achievable recommendations including:

  • Increasing support for the world’s most skilled workforce;
  • Ensuring small and medium-sized aerospace businesses thrive and grow;
  • Using innovation to capture new opportunities including carbon neutral flight & unmanned vehicles;
  • Investing to main Transport Canada’s internationally recognized status for aircraft certification and regulation;
  • Maximizing Canada’s leadership at the forefront of space; and
  • Maximizing defence procurement and government partnerships to driven new industrial growth.

It was through industry-government partnership and commitment over the past 80 years that Canada rose to fifth among aerospace nations. Today, we rank ninth. And our positioning was slipping even prior to the effects of the global pandemic. The post-pandemic competition will be fierce.  Without a strategy, it will be increasingly difficult for Canada to compete and contribute to the economic recovery that is required.  Canada must have a clear vision of where and how it will compete to win so that the entire value chain can contribute and succeed.

We must build upon our strengths, including our highly skilled, world-leading workforce.  We need to support these workers and grow the workforce through skilled labour programs, partnerships with post-secondary institutions, industry-government collaboration, and cooperation with Employment and Social Development Canada, and other departments across government to ensure we have the workers for high-paying, value-added jobs for generations to come.

As part of a Canadian Aerospace Strategy, Canada too needs a Defence Industrial Strategy to ensure procurement continues to support the development of Canadian industrial capacity and capability.

As a country, we need to commit to ensuring procurements, both large and small, continue without delay and are finalized and announced in a timely manner.  Maintaining a predictable and consistent defence procurement program will be of significant benefit to the industry and also Canada’s long-term security requirements.

Canada can use procurements through Strong, Secure, and Engaged to support the development of Canadian industrial capacity and capability.  This would showcase firms that operate in Canada and have global leading technology, services, and aircraft.

There are also opportunities when it comes to modernizing aerospace and defence programs to spur investment.  Updating key aerospace and defence programs such as the Industrial Technology Benefits (ITB) program to increase support for SMEs and the Canadian supply chain should be part of the discussion moving forward.  The Canadian Advanced Research Projects Agency that was committed to in the Liberal Party of Canada platform is another such promising program that can continue to build the industry.

Likewise, the Canadian Aerospace Strategy must include an overarching national space plan to guide decision-making.  It must be balanced, sustainably funded with a long-term planning horizon, and predictable in its implementation.  

Doing things in space is no longer a value-added activity.  It is a must given the absolute reliance we have on space-enabled services.  Whether it be the role of space in connecting us globally, keeping us safe while moving about our daily lives and engaging in commerce, or monitoring and acting on climate and environmental changes that can only be done from space, there is no disputing that space is an increasingly critical domain.

Competition is good and the Canadian space industry has flourished because of it and our strong heritage in space.  Sixty years have yielded many firsts in space for our nation. The future can be even brighter, providing we work hard to regain our foothold. Canada has leading-edge space universities that rank among the best in the world.  Canada excels in robotics, communications, and earth observation, to name just a few strengths.  

It’s time for a clear set of national objectives with a roadmap to maximize our hard-won leadership to ensure Canada continues to contribute to the society-wide benefits of space research and innovation.  We must ensure sure Canada has a strong policy top cover, a strategy that focuses on its strengths, and a resilient plan to best realize it, regardless of the circumstances.

With a skilled workforce that is the envy of the world, a robust export capacity, and a global reputation for cutting-edge innovation and technology, a Canadian Aerospace Strategy will secure and restore Canada’s global leadership in aerospace, targeting the creation of new, high-value jobs, strategic R&D and cleantech innovation.

Renewed Government partnership is needed now and it doesn’t need to be complicated.  If we bring together industry and government while engaging provincial governments who are investing significantly in the labour market we can once again punch above our weight and contribute to the post-pandemic economic recovery.

As the re-elected Liberal minority government, together with the opposition parties, lay out their priorities for the future we urge them to work with us on a Canadian Aerospace Strategy.  Let’s renew the partnership that built this sector into a global aerospace champion.  Because meeting the challenges of today and the potential of tomorrow will require collective action and multi-sectoral partnerships.

Together, let’s forge a new era of collaboration, nation-building, and Canadian ingenuity in aerospace. Let’s ensure Canada is a leader in aerospace – defence, civil, and space –  for decades to come.

Mike Mueller is President & CEO of Aerospace Industries Association of Canada.