Aerospace

Introduction | Industry Size and Composition
Labour Force | Business Competitiveness | Innovation

Introduction

The Greater Toronto Area’s aerospace industry has a proud history of innovation and technology leadership, enhances the well-being of Ontarians and all Canadians, is strong contributor to Ontario’s and Canada’s economy, and supports our international reputation as a knowledge-based economy.

Ontario aerospace companies, supported by strong supplier clusters, have market-leading positions in several market niches, including:

• Air Conditioning Systems
• Avionics Displays
• Business Jet Aircraft Integration
• Electrical Power Distribution Systems
• Integrated Avionics Systems
• Landing Gear Systems
• MRO and Aircraft Modifications / Conversions
• Regional Turboprop Aircraft Integration
• Space Robotics Systems
• Turbine Engines
  

 

Ontario’s aerospace industry is comprised of more than 350 firms who employ approximately 23,000 people – many of whom are highly qualified engineers, technicians and scientists – and generates revenues of approximately CDN$ 6 billion.

As world leaders in major aerospace programs and niche markets, GTA firms are suppliers to diverse aircraft such as the Airbus A380, Boeing 787 Dreamliner and the U.S. led Joint Strike Fighter (F-35).  Market leading, state of the art aircraft like the Q-400 turbopop regional airplane and the Global Express business jets are produced here by Bombardier Aerospace. The world renowned Canadarm I robotic arm for NASA’s Space Shuttle and Canadarm II (plus other components of the Remote Manipulator System for the International Space Station were designed, developed and produced by MDA (then Spar Aerospace).

With a sophisticated research capacity, a well-educated and highly skilled workforce and globally competitive solutions, the GTA ranks among the top choice for trade and investments in the aerospace sector. The aerospace cluster is also backed by industry-leading organizations such as the Ontario Aerospace Council, the Ontario Government through the Ministry of Economic Development & Trade, and Canadian government departments and agencies including Industry Canada, Export Development Corporation, the Canadian Space Agency, National Research Council and Canadian Commercial Corporation.

Industry Size and Composition

The Ontario aerospace industry is 2nd largest in Canada, and is concentrated strongly in the GTA.  Approximately 70% of Ontario employment (16,000) or 21% of Canadian employment.

GTA is the economic engine of Canada, founded on its diverse technology-based industrial and commercial business clusters. With 85% of Canadian aerospace exports going to the United States, the GTA is well positioned in the North American marketplace.

Market Segments

The aerospace industry in the GTA is comprised of several key segments:

Canadian Aerospace Industry Segments

Major Players in the GTA

A few major companies make up the bulk of the aerospace industry in the GTA.  These include

In addition, more than 250 companies in Ontario – mostly small to medium-sized enterprises employing 50 to 100 people – specialize in particular niche markets and/or are suppliers to the systems integrator firms.

For more comprehensive database of GTA based aerospace company capabilities, link: www.aero-canada.ca

Key Support Systems

Aerospace Action Partnership (AAP)

The AAP is a public-private partnership created to develop and implement an aerospace cluster strategy called "Flight Path: A Vision for the Future," which charts a course for the industry. Goals outlined in the plan are to promote the health and growth of the industry, lead the world in innovative customer-focused products and services, ensure the development of skills and knowledge to support the industry, and develop a world class brand. For more information on the strategy, link: http://www.toronto.ca/invest-in-toronto/pdf/july2005_flight_path.pdf

Ontario Aerospace Council (OAC)

A not-for-profit, non-share capital corporation governed by a Board of Directors representing all segments of the Ontario aerospace industry. The OAC's goals are to enhance recognition of the Ontario aerospace industry as a leader in global aerospace markets and to build stronger capabilities in the industry to assure continued growth and prosperity.

Testimonial

"The Toronto area is home to some of the world's leading aerospace manufacturers clustered around aircraft and aerospace systems integrators. Supported by a strong cadre of globally competitive high technology equipment firms and suppliers, these market leaders are leveraging Toronto's strengths as a vibrant centre for research and technology development, finance, and higher learning. Together, these make Toronto the location of choice for aerospace firms to locate as a base from which to win business in North America and globally." 

Rod Jones, Executive-Director, Ontario Aerospace Council

Sample of Major Projects

Pratt & Whitney Canada Corp. a United Technologies Corp company will invest $1.5 billion over 5 years in R&D for development of next generation made-in-Canada aircraft engines. This investment is expected to generate over 1,500 direct and indirect jobs at P&WC's facilities across Canada. P & WC (through United Technologies) will also invest $75 million in joint projects with 20 Canadian Universities, including Ryerson, U of T and McMaster."

Pratt & Whitney Canada is the number one R&D investor in the Canadian aerospace sector. Our company ranks Canada first internationally for access to well-educated workers. We get great people - graduates from first-rate engineering courses offered by Canadian universities."

Alain M. Bellemare, President, Pratt & Whitney Canada

Messier-Dowty Inc. On December 19, 2006, the Canadian government made a repayable investment of $27.5 million in a $96.3 million R&D project for advanced prototype landing gears. As the second largest landing gear firm in Canada, Messier-Dowty Inc. will commence operations at their Ajax ON and Mirabel QC locations, by developing advanced aircraft landing gear to be used in both civil and military aircrafts. The project will sustain the company’s corporate “Landing Gear Centre of Excellence,” while meeting long-term industry wide goals.

Labour Force

The GTA region's 200 plus aerospace manufacturers employ over 16,000 skilled and educated technicians, with nearly two-thirds of all aerospace engineers in Ontario employed in the GTA.

Aerospace Engineers in Ontario’s Urban Areas* and in Ontario

Source: Statistics Canada, 2001 Census

Key Employers in the GTA

Role of Academic Institutions

The GTA offers an excellent array of educational institutions for leading-edge aerospace training and skills, as well as advanced R&D capabilities, including:

Business Competitiveness

According to KPMG’s 2006 Competitive Alternatives report, Canada leads the G7 countries in terms of low business costs, with a cost advantage of 5.5% over the US. In contrast, costs are also comparably lower in aircraft systems and parts manufacturing generating almost twice as much profit.

Aircraft Component Cost Compared to the US             

Index: US=100

Source: KPMG Competitive Alternatives 2008 Edition

Canada/US Exchange rate of 1.17 (US $0.852)

Source: KPMG Competitive Alternatives 2006 Edition

Highly Competitive Labour Costs

Because Canada has the lowest cost of living among G7 countries and a publicly funded health care system, labour costs are comparably lower than the United States and other competitors.

Labour Cost

In addition, generous R&D tax incentive programs can significantly reduce R&D expenditures.

Source: www.2ontario.com

Innovation

The GTA aerospace cluster has been a leading center of innovation and technology leadership for almost 100 years.

Collaboration between industry and academic institutions (Ontario’s Innovation Corridor)

Stretching from Ottawa to Windsor and extending up into Northern Ontario, this corridor is home to world-leading companies such as:

• Bombardier Aerospace
• MacDonald Dettwiler and Associates
• Messier Dowty
• Pratt & Whitney Canada

and others  who carry out significant research and technology development in collaboration with more than 15 university, college and public research centers including:

• Carlton University

• McMaster University

• Queen’s University

• Ryerson University's Institute for Aerospace Design and Innovation (RIADI)

• University of Ontario Institute of Technology

• University of Ottawa

• University of Toronto’s Institute for Aerospace Studies

• University of Waterloo

In addition, the planning and testing of groundbreaking discoveries have further catapulted and reinforced the province of Ontario and the GTA as the premier destination for innovation. Located across the province, these public research centers include:   

• The Institute for Aerospace Research Ottawa, Canada's national laboratory for aerospace R&D
• David Florida Laboratory, Ottawa, Canada's world-class spacecraft assembly, integration and testing center
• Integrated Manufacturing Technologies Institute, London, a breeding ground for new products and technologies.

Strong Government Support for R&D

With attractive Research and Development tax incentives, backed by a high-level capability evidence by the supply of numerous prestige universities and colleges, laboratories, scientists and engineers, the government continues to ensure the innovative nature of Ontario’s aerospace industry by providing a large and growing number of R&D support programs:

• The Advanced Manufacturing Investment Strategy (AMIS): a $500 million repayable loan program (interest free) that will help stimulate the economy by encouraging private sector companies to invest and adopt innovative technologies
• The Strategic Skills Initiative contributed roughly $5 million in Aerospace related initiatives and training in Ontario
• Most generous R&D tax incentive program in the G7
• Ontario's Centers of Excellence, such as the Center for Materials and Manufacturing, connect companies with public sector scientists and research facilities to develop commercial innovations.
• Provincial government: committing $1.4 billion over four years to support Ontario-based R&D and its commercialization.
• Federal government: aerospace R&D support programs through the National Research Council’s Institute for Aerospace Research, the Canadian Space Agency, Strategic Aerospace and Defence Investment (SADI), and NRC’s Industrial Research Assistance Program.
• Early Researcher Award (ERA) program: provincial government will invest $51 million over five years in the next generation of researchers. In the GTA, 33 researchers received awards for their research in a wide range of fields.

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