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AIAC Testifies at House of Commons Standing Committee

On January 28th, Mike Mueller, Senior Vice President at AIAC, testified before the House of Commons Standing Committee on Transport, Infrastructure and Communities to press the case for the need for aerospace support and a sector strategy. The following are his remarks to the committee.

It’s a pleasure to be here on behalf of the Aerospace Industries Association of Canada.

As most of you will know, our members represent over 95% of aerospace activity in Canada, covering the civil, defence and space sectors.

Aerospace has been a driving contributor to Canadian prosperity for decades – providing nearly 235 thousand jobs and over $28 billion annually to our nation’s economy. This hasn’t happened by accident. 80 years ago, our political and industrial leaders made strategic decisions. They recognized the potential of this great industry to shrink our vast geography, facilitate global trade & commerce, help secure our borders, and raise our quality of life.

These political leaders were keenly aware that smart policy decisions and key investments, would build Canada into a global aerospace leader. They knew the investments we made as a country would yield significant dividends – and their vision was correct. Canada became the 5th largest aerospace industry on the planet – and a true source of pride.

But in recent years, that vision, investment and support has been slipping… and so has Canada’s global positioning. The impacts of COVID-19 have meant further challenges, and we’ve fallen even further behind.

The industry is reporting losses in revenue of over 40%, 95% of companies are reporting various levels of shutdowns, and over 50% have laid off employees. Support is needed – and it is needed immediately.

While the government’s emergency measures have been appreciated and helpful– they’re just not enough. Not when aviation and aerospace are facing unprecedented challenges. And not when other leading aerospace countries – our competitors – began taking action early on.

For example, France invested $26 billion…the US invested $80 billion, Hong Kong $5.2 billion, Germany $9.8 billion, and on and on. These countries – our competitors – have positioned their sectors for the future. Canada needs to do the same. Because the future is bleak for aerospace if its leading customers — the airlines — can’t buy its products and services.

The effects of COVID-19 have cascaded throughout the supply chain, and throughout the country. Our members are located in every region. And no one has been immune, regardless of size.

Data from leading Global Aerospace & Defence experts warn of the consequences if no action is taken or no long-term strategy developed.

The need to protect our highly-skilled, well-paying jobs, is now. This industry’s competitive advantage has been our skilled workforce. In the context of COVID19 this is our strength….and our challenge. We need government investment in aerospace so we can be part of the economic recovery… and post-recovery…we can once again be global leaders. But we can’t do it alone. We need a partner in government…indeed, all parties in the House of Commons.

Finally, I want to touch on innovation – a hallmark of this industry. Great strides are already being taken by aerospace companies to ensure a greener, more sustainable future. We’re ready to help with elements of the government’s green agenda. The industry is committed to this.

And we’re fully committed to working in partnership with you, on a National Aerospace Strategy that takes into account civil, defence and space. This is critical. As I said, every one of our competitor countries has a strategy.

We are also seeking support from Government to partner with us to help our transition to new technologies and products…A transition that will keep people employed, and ensure we remain a skilled workforce. With over 80% of what we produce exported, there are opportunities to build more efficiency and transparency into export market opportunities. There is also an opportunity for the government to support our industry by accelerating planned spends on the defence and space side.

I’ll conclude today by saying there are tremendous opportunities. Let’s ensure that Canadians can continue to take pride in our Canadian aerospace industry….to continue Canada’s leadership in R&D and in training, and to protect our skilled workers and good paying jobs, from coast to coast to coast. All while putting aviation and aerospace on the path to a greener future.

We can’t be naïve. Other countries are, as we speak, actively soliciting Canadian firms to shut down and move to their jurisdictions. Aerospace exists in a fierce, globally competitive marketplace. Once these jobs leave, they don’t come back. It’s no accident that a country of just 35 million has such a thriving aerospace sector.

So on behalf of our industry, we urge all of you to continue the tradition, and stand by this industry. Grow it for the future. Protect its legacy and its jobs.

Thank you.

 

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