Aviation focus: Quebec

Transcription

1 Aviation focus: Quebec Some people say Quebec will be less favoured, observes Mechtronix president Xavier Hervé, commenting on the New Democratic Party s provincial victory in the election which recently swept the Conservative Party to a historic federal majority in Canada. I don t think so. Canada s aerospace industry is in Montreal and Canada s aerospace industry is fundamental for Canada globally. It s also a source of pride, explains Suzanne Benoît, CEO of aerospace think tank Aéro Montréal. Look at all the countries in the world that want to develop aerospace. The province of Quebec is home to the headquarters of the International Air Transport Association (IATA) and the International Civil Aviation Organisation (ICAO) as well as 226 aerospace companies generating annual sales of C$10.9bn (approximately the same in US$). This figure puts Quebec seventh in world rankings behind the United States, France, Germany, the United Kingdom, Italy and Japan. 80 per cent of sales are exports, with Quebec the sixth largest exporter to the US. Since 2007, the Quebec aerospace industry has announced C$5bn worth of projects, largely in the commercial sector. Greater Montreal harbours 98 per cent of Quebec s aerospace activity and is classed as one of the top three aerospace hubs in the 18 Aircraft Technology - Paris 2011 Special

2 Montreal in the province of Quebec is the centre of Canada s aviation industry, boasting a rich engineering heritage, a highly skilled workforce, end-to-end capabilities, a strong R&D focus and impressive development programmes. Joanne Perry investigates the region s aviation industry and discovers that the Q in Quebec stands for quality. world, behind Seattle in the US, and Toulouse in France. Within a 30km radius are a plethora of companies supplying all the elements necessary to build an aircraft: engines, airframes and components. You can t do that in Toulouse or Seattle, says Marcel Landry, VP business development at Thales. In Montreal, though, you have everything. Quebec s aerospace network includes global giants such as Bombardier, Pratt & Whitney Canada, CAE and Bell Helicopter as well as Air Canada MRO spin-off Aveos. Present on a smaller scale are the globally renowned transnational corporations GE Aviation, Rolls- Royce, Messier-Bugatti-Dowty, Esterline CMC Electronics, Thales, Goodrich and Lockheed Martin. Landing gear manufacturer Héroux- Devtek and flight simulation specialist Mechtronix join Aveos as locally owned businesses. These well-established companies act as co-ordinating points in a web of diverse aerospace manufacturers and service providers in Quebec. The first to be established in Quebec was Esterline CMC Electronics, operating in 1903 as the Marconi Wireless Telegraph Company of Canada, followed by Canadair now Bombardier in The region s engineering heritage was later bolstered by two significant events: the establishment in 1944 of Aircraft Technology - Paris 2011 Special 19

3 Top: A hangar at the National School of Aerotechnics (ENA), Montreal. Above: ENA students at work. public hydro-electric power utility Hydro-Quebec, when international experts were invited to help construct the world s second largest hydroelectric complex; and the takeover and reinvigoration of Canadair by Bombardier in Consequently, very few families in Quebec today cannot boast at least one member with an engineering background. An educated workforce The nurturing of Quebec s skilled workforce continues through governmental, corporate and academic efforts three strands which are very much intertwined. Janka Dvornik, head of communications and press relations at CMC, describes this as a real cohesion. The Quebec aerospace industry currently employs 39,500 skilled workers, with one individual in 200 working in the sector rising to one in 95 in Greater Montreal. The local expertise is constantly being fed by 4,800 new aerospace graduates each year, produced by one specialised school, five technical colleges and six universities, which CAE civil simulation group president Jeff Roberts describes as pretty formidable. This is just as well; Normand Raymond from the Ministry of Economic Development, Innovation and Export Trade says that because Quebec s aerospace industry is more commercial than military at a ratio of about 9:1 the universities must take on the brunt of developmental risk. Robert Davidson, from economic development agency Invest Quebec, says that there is robust interest in technical training and that the supply of graduates thus far satisfies the industry s needs. Aerospace companies in Quebec are united in their praise of the local talent pool. This is one way in which the region out competes others: For us, it really is the manpower that makes the difference, says Patrick Champagne, CMC cockpits and systems integration VP. Or, as Hervé puts it: Finding a 10/15-year avionics guy is not easy in any country; it s much easier in Montreal than in many other places. 20 Aircraft Technology - Paris 2011 Special

4 This is the strength of Montreal: It s the brainpower, the talent, the ability to come up with good engineering programmes. Suzanne Benoît, CEO, Aéro Montréal Quebec s aerospace industry enjoys a very close relationship with the education system. Benoît describes Quebec s institutes as being very agile, responding quickly to industry needs. Champagne talks of the deep collaboration between the two, saying that when academic establishments uncover notable talents, they call us; when I have an idea, I call them. He defines the academic focus as crystallising research research which produces concrete results. The industry provides internships and taster projects, encouraging interest in aerospace training and careers by direct contact with students at every level. For example, Pratt & Whitney Canada has a training centre at the country s largest technical institute, the National School of Aerotechnics (ENA), which uses equipment provided by P&WC as well as Rolls-Royce and Bombardier. Educational establishments are also present within aerospace companies; ENA, for example, is working with Bombardier to provide training on its own premises. ENA also has a non-profit applied research affiliate called Centre Technologique en Aérospatiale (CTA) within its grounds. CTA has its own laboratories, offices and hangar, with a total of 30,000ft 2 dedicated to research. It also has access to the infrastructure of the school. Founded in 1993, CTA is a public-private partnership recognised by the Ministry of Economic Development and the Ministry of Education, the latter providing C$300,000 of CTA s C$2.5m total budget the rest originates from industry. The expertise of Quebec s aerospace workforce should help to sustain the industry in the face of a general tendency towards the placement of manufacturing facilities in low-cost countries such as Mexico and China. Bombardier and Héroux-Devtek are among the companies adopting this strategy. Benoît does not feel that Montreal will lose out, however, as companies are likely to subcontract back to Quebec. The reason we feel confident is because of the talent, the schools, says Benoît. This is the strength of Montreal. It s the brainpower, the talent, the ability to come up with good engineering programmes. The role of the Government At the political level, too, there is a strong vision of how Quebec s aerospace industry, with

5 its high-end research and engineering capabilities, fits into the broader picture. As Clément Gignac, Minister of Economic Development, Innovation and Export Trade of Quebec, remarks, We are in the global village, we believe in globalisation. We [also] believe in the supply chain; the supply chain is now global. Gignac is happy for Quebec companies to set up plants in countries where labour costs are lower, since it helps them to remain competitive and more than that, to grow. He describes the trend as a normal phenomenon. Says Gignac: Bombardier has more facilities now than ten years ago outside Quebec, but Bombardier is bigger than ten years ago. We have more workers in Quebec in aerospace than ten years ago because our local companies have become big global companies. He feels it is a mutually beneficial situation: It s a win for the other countries, which see some job creation, but it s a win as well for Quebec because the companies create additional jobs in Quebec and pay taxes in Quebec as well. Quebec may not be as low-cost as developing nations but it compares well with the rest of the Western world in terms of corporate tax and, according to the KPMG Guide to International Business Location 2010 Edition, average pay and electrical costs. Quebec steals a march on other nations in terms of electrical power by virtue of its immense natural resources; around 97 per cent of power comes from renewable water sources harnessed by Hydro-Québec, as well as wind and biomass technologies. Not only does this provide stable, low rates for businesses, it also ensures that Quebec is well positioned in terms of sustainability. The Government displays an impressive amount of co-ordination and commitment in encouraging progress in the aerospace sphere, whether this means offering financial inducements, setting up development bodies or promoting research and development. This is something which is recognised by the industry. Certainly for research we have good support, and for development as well, says Patrice Gauvin, VP of Héroux-Devtek. Meanwhile, Benoît is keen to point out that the Government s assistance is more than just a generic pro-business approach, emphasising that for the aerospace industry the Government comes up with very customised programmes that will actually help. Clément Gignac, Minister of Economic Development, Innovation and Export Trade of Quebec. THIS IS WHERE WE TEST AND PROVE CFM PARTS FOR 525 MILLION HOURS. Beware of false profits. Replacement parts may not stand the test of time like a CFM * part. Because only CFM parts have been tested where it counts for so long, and so often. Only CFM parts have been refined, improved and perfected in extremes of temperature, at every altitude, for hour after punishing hour. As some airlines have learned, only 100% genuine CFM replacement parts bring genuine savings. Proving it to you won t take long. Visit * CFM, CFM56 and the CFM logo are all trademarks of CFM International, a 50/50 joint company of Snecma and General Electric Co.

6 Top: CAE s 7000 Series full-flight simulator. Above: A Mechtronix employee at work. Photo: Mechtronix Many companies speak approvingly of the provincial PASI and federal SADI programmes (Strategic Support for Investment Program and Strategic Aerospace and Defence Initiative respectively) which provide guarantees, loans and even non-repayable contributions as a last resort. These help particularly when the focus is research and development (R&D), which banks are reluctant to finance. One beneficiary is Mechtronix, which prides itself on its innovation focus and has received a number of loans from Government bodies, including the agency which handles PASI, Invest Quebec. Hervé is open about the impact this made: They basically enabled the business model. In addition to guarantees and loans, the Quebec Government offers substantial tax incentives which can cut R&D costs by 50 per cent or more. Gignac says Quebec currently invests 2.6 per cent of GDP in R&D (C$7.9bn in 2008), more, he says, than the Canadian and OECD averages. Indeed, KPMG ranks Quebec first among North American cities for R&D based on total tax index. Invest Quebec is only one of several organisations either managed or partnered by the Government as part of its aerospace development strategy. Whereas Invest Quebec is an economic development agency and financial institution for business, there are two key bodies oriented toward research: CRIAQ, the Consortium for Research and Innovation in Aerospace in Quebec, and the National Research Council Canada - Aerospace. CRIAQ, set up in 2001 and incorporated as a non-profit organisation in 2002, holds research forums which germinate R&D projects involving both educational and corporate organisations allowing students, academics and industry experts to work together to advance aerospace technology and workforce capability. President and CEO Clément Fortin describes it as a project coaching and building specialist. CRIAQ also manages and is an active member of the board of the newly launched Green Aviation Research and Development Network (GARDN), which promotes the development of 24 Aircraft Technology - Paris 2011 Special

7 sustainable technologies by acting as a kind of broker, a broker with cash according to manager Sylvain Cofsky. Half of GARDN s four-year budget of C$23m originates from the Canadian Government, the rest from industry. A federal organisation, as the name suggests, the National Research Council Canada Aerospace has five laboratories, including a new initiative at Université de Montréal called the Aerospace Manufacturing Technology Centre (AMTC), which arose from a partnership between NRC and Canada Economic Development for Quebec Regions. The Aerospace division boasts the most substantial NRC research facilities, designed to help Canada s aerospace industry to remain or become more competitive on a global scale by making technology affordable and implementable, in the words of AMTC director Pierre Dicaire. Latest developments The Government is determined to maintain momentum in R&D, aware that investment is necessary to continue Quebec s position of leadership. This includes times of recession, during which, Gignac continues, nations must nevertheless pour resources into stimulating industry. The Minister says Quebec did not cut but rather increased support for the aerospace industry during the last few years, and has already started to see the dividends in terms of job creation, taxes and income recovering 200 per cent of job losses to beat the rest of Canada and the US on employment rates. In particular, the Quebec Government was heavily involved in bringing the Pratt & Whitney Canada next generation engine assembly and test centre to Mirabel, as well as Bombardier s CSeries programme. Speaking at the inauguration of P&WC s 300,000ft 2, C$360m Mirabel Aerospace Centre on May 6 this year, Louis Chênevert, chairman and CEO of the parent company United Technologies, commented: This facility has been made possible by company leadership and the Quebec and Canada governments who had the vision and courage to build a world-class aerospace centre here in Mirabel. Other companies to invest in Quebec recently include Héroux-Devtek in Longueuil, Mechtronix in Saint-Laurent and Aveos in Dorval. At CAE too, Roberts says that the company is proud to have invested during the reces- This [new P&WC] facility has been made possible by company leadership and the Quebec and Canada governments who had the vision and courage to build a world-class aerospace centre here in Mirabel. Louis Chênevert, chairman and CEO, United Technologies A380 4 million parts AIRCRAFT TECHNOLOGY S annual publication for the MRO professional MORE than the sum of its parts 2012 Deadlines: Ad Booking: August 8th 2011, Ad Copy: August 15th 2011, Publishing: September 5th If you want to promote in the 2012 edition of The MRO Yearbook, or if you would like any other information, please contact any of the Sales Team: Simon Barker, Alan Samuel or Anthony Smith on Tel: +44 (0) / -46/ -75 or via simon.barker@ubmaviation.com or alan.samuel@ubmaviation.com or anthony.smith@ubmaviation.com Aircraft Technology - Paris 2011 Special 25

8 Top: An FTB4 in Pratt & Whitney s Mirabel facility. Above: Bombardier s CSeries aircraft is being assembled at its facility in Saint-Laurent. sion; CAE invests approximately 10 per cent of its revenue in R&D each year. Aveos, meanwhile, has a newly operational components facility which is due to be completed mid The centre boasts the latest in equipment and ergonomic design. Jerry Kent, VP and GM component solutions, is pleased with the progress of the development, remarking that it will allow workers to function at the peak of efficiency, like a surgeon in an operating room. At both a corporate and individual level there seems to be a steadfast attachment to Quebec s identity as a capital of aerospace. Employers speak of a workforce which is less mobile than in other nations (three per cent of turnover versus eight per cent in the US, according to Invest Quebec). This is quite probably an effect of the region s status as a singular crossroads between American and European culture which offers a special quality of life. It brings advantages for businesses beyond staff loyalty and experience, most importantly access to both American and European markets, culturally and linguistically and in terms of the US, geographically. It s very natural in Quebec, comments Hervé, to put together international, multidisciplinary teams. As Philippe Molaret, VP operations at Thales, explains: From Montreal we are open to the North American market, much more so than from France. There is a recipe, Gignac believes, for why Quebec is an attractive location for the aviation industry: the breadth of the corporate network; the talent and training of the local workforce; the political commitment to and capability for development; and cultural inclinations. With the Government continuing to push for growth, leading corporations investing and Quebecers remaining proud of their aerospace heritage, the region is set to remain in the words of its Minister of Economic Development, Innovation and Export Trade very open for business. 26 Aircraft Technology - Paris 2011 Special