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Vision 2025: Charting a New Course

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Vision 2025: Charting a New Course CHARTING A NEW COURSE CANADA AS A GLOBAL AEROSPACE CHAMPION HON. JEAN CHAREST, CHAIR PARTNER, MCCARTHY TÉTRAULT S.E.N.C.R.L., S.R.L. “Eighty years ago, Canada’s decision- makers committed to making the country a global leader in aerospace. They were visionaries. THE TIME HAS COME FOR US TO RENEW THAT COMMITMENT.” –Hon. Jean Charest, Chair Partner, McCarthy Tétrault S.E.N.C.R.L., s.r.l. From developing the cutting-edge AVRO Arrow to operating two Canadarms in orbit and building the fifth-largest aero- space industry on the planet, the Canadian aerospace sector is a true source of pride for the people of Canada. Today the industry stands as one of our country’s proudest achievements—and a driver of Canadian innovation. It con- tributes nearly 215,000 jobs and $25.5 billion annually to the Canadian economy. None of this happened by accident—and it can be lost if we ignore it. It took vision, investment and partnership among govern- ment, research institutions, our armed forces, industry and Canadian workers. Eighty years ago, Canada’s political and industrial leaders understood and built on the country’s competitive advan- tages. They knew there was a limited number of competing nations in aerospace. They knew Canadian companies were more technologically advanced. They knew our geographic proximity and geopolitical affinity with the United States gave us an edge. Times have changed—rapidly. Powerful new and competing economies have entered the market. Disruptive technologies are reshaping the industry at an accelerating pace. What hasn’t changed is the need for vision, investment and partnership. We are at a critical turning point. If Canada is to remain a global aerospace champion, we need a bold new vision for the industry—fully aware of the new realities and building on our strengths to keep us at the forefront of discovery and innovation. This is that vision and plan. We’re charting a new course. 1 In October 2018, the Aerospace Industries Association of Canada (AIAC) enlisted the Honourable Jean Charest to lead a consul- tation named Vision 2025: a pan-Canadian mission bringing industry and our partners together to reaffirm Canadian leadership in the global aerospace sector. This report reflects what we heard from Canadians, and what needs to be done if our country is to remain a global aerospace leader and champion. CHARTING A 2 NEW COURSE Canada’s aerospace industry has the The aerospace industry has been a opportunity driving contributor to Canadian prosperity for decades. Canada ranks first globally in the to soar manufacture of flight simulators and second worldwide in business aircraft production. The recently released 2019 State of Canada’s Aviation Industry Report notes that we are, right now, the only country with a top-five rank in all categories, including civil flight simulators, engine manufacturing and aircraft assembly. Yet we know reputations and legacies don’t maintain themselves. Our members at the Aerospace Industries Association of Canada (AIAC)— companies big and small, longstanding and fresh out of the gate—are keenly aware that the powerhouse industry Canada has built is at risk. 3 Despite the above scenarios, While the global nature of aerospace Vision 2025 will be the catalyst employment in Canada’s aero- means our competitors are other for this new approach to Canadian space manufacturing sector nations determined to win, it also aerospace growth and leadership has decreased by 5% and aero- means there are global companies if government and industry work space contribution to GDP has out there that—if they know Canada together and make this an urgent decreased by 4% since 2012. remains serious about aerospace— priority. The priorities and areas for Competitor countries have will choose to do business here. increased collaboration identified invested heavily in the aerospace AIAC launched Vision 2025 because in this report represent steps that sector. Since 1992, Canada has we understood the urgency of the must be taken if we are to seize the fallen from 8th to 18th place situation—and that the best way opportunities that lie ahead for our globally in spending on space as to begin building a new future for industry. I want to thank and express a percentage of GDP. Canadian aerospace is to start with my appreciation to our AIAC mem- Around the world, nations are a new vision. One that recognizes bers, stakeholders and provincial seeing the potential of aerospace an environment for investment and partners, all of whom have made an to transform their economies and growth in aerospace has to look invaluable contribution to this vision- create new opportunities for their not only to the domestic horizon ing process over the past year. citizens. They have watched and but also beyond—to the global With the rising global middle class, learned from countries like Canada ecosystem aerospace companies the demand for aircraft is going to that have leveraged aerospace to inhabit and compete in every day. double in the next 15 years. We are attain a position of global leadership. One where all contributors to also going to see increased military They want what we have, and they Canada’s aerospace success— spending and a greater worldwide are acting boldly and strategically industry, governments, educational commitment to space. By making the to claim it. That’s the reality our institutions and other stakeholders— right decisions today, Canada will aerospace industry operates in. If we are on the same side of the table, have a major share of this growth. don’t adapt our approach to reflect committed to working shoulder- this reality, we will continue to lose to-shoulder to compete for Canada the ground we have worked so hard in the global marketplace. Jim Quick for so long to gain. President and CEO, Aerospace Industries Association of Canada CHARTING A 4 NEW COURSE The sky’s the limit if Canada is ready to lead If there was one thing I heard geography, facilitate global trade to do research and manufacturing consistently in my cross- and commerce, help secure here. As more than one industry country discussions this our borders and raise our member has said to me, we punch quality of life. way above our weight. winter as part of Vision 2025, it was that we have reached As a country with a small In recent years, the global population, we didn’t have a economy has changed profoundly. a pivotal moment in the life natural domestic market for This is confirmed in the of the Canadian aerospace this. What we had instead was aerospace industry. industry, one that will decide a long-term vision, deliberate Internationally, growth is going to its ultimate fate. public policy and sustained be exponential over the coming effort over the ensuing decades. It’s not the first time we’ve faced decades as the world’s middle such a choice. Aerospace is a Today, Canada is a top performer class swells—with millions in vital legacy industry in Canada across key segments. We have India and Asia in particular joining because we decided as a nation at homegrown market leaders its ranks. People want to travel. the end of the Second World War alongside emerging industry Demand for air transportation to make it so. The political lead- players. We have hundreds of will soar. ers of the day saw the potential dynamic smaller firms. We’ve for aerospace to shrink our vast attracted international companies 5 Every person I spoke with along the “The political leaders of the day way was proud of Canada’s place in the global aerospace arena. saw the potential for aerospace It’s been an honour and a privilege to shrink our vast geography, to Chair the Aerospace Industries Association of Canada’s Vision 2025 facilitate global trade and com- consultations. Over the course of my political career—both federally and merce, help secure our borders provincially—I’ve seen the powerful contribution aerospace makes to and raise our quality of life. We this country. That was confirmed in every city we visited: Toronto, Mont- chose to be a leader. We need real, Ottawa, Winnipeg, Vancouver and Halifax. Each has its own dis- to choose again.” tinct focus and specialization; each also sees itself as part of one of Canada’s truly national industries. Advanced industrial economies Governments have good reasons for everywhere want a share of that getting behind aerospace. In Canada, I promised the AIAC board and estimated $10 trillion market. the industry has provided nearly membership that this was not going That includes Canada’s traditional 215,000 good jobs in every region to be another Royal Commission- aerospace competitors such as the of the country. It is active in every type report. We want to define U.S., France and the UK. But, for province. It contributes $25.5 billion the priorities and areas for further the first time, it also includes new to our GDP every year. action. More than anything, this report is about new partnerships in entrants such as India, Vietnam, So what do we need to do to keep an aggressive pursuit of new jobs, China, Russia, Singapore and others. that going? They’re thinking long-term—as new innovation and new growth. If far as 50 years out—and they’re We have all the elements for government and industry commit moving fast. This is happening while success. What’s essential is the to a new vision, goals and oppor- in Canada industry members are commitment of industry and tunities, Canada will be a global expressing concern about the loss government to confront the new champion of the sector.
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