Facing ‘catastrophe,’ Quebec industry pleads for federal aid
Major players in Quebec aerospace are urging the federal government to step up with an aid package that would help companies weather the COVID -19 storm.
Governments from France to Italy, Singapore and the U.S. have unveiled more than US$120 billion of aid combined for airlines and aerospace companies. The magnitude of the effort speaks to the strategic importance of aerospace globally, said Philippe Balducchi, head of European plane-maker Airbus SE’S Canadian unit.
“We look at what’s happening elsewhere in the world, in countries that have built aerospace sectors, and we see a mobilization of governments” to support the industry, Balducchi said last week during a panel discussion organized by the Aéro Montréal industry association. “It’s really urgent for Canada to send strong signals that it wants to keep its aerospace industry.”
Airbus and U.S. engine manufacturer Pratt & Whitney are some of the key aerospace companies that have laid off hundreds of Montreal-area workers since the pandemic began. Smaller players have also been hit. Héroux-devtek Inc., the Longueuil-based landing-gear producer, said in May it would eliminate 125 Quebec jobs as part of a 10-per-cent workforce reduction.
David Chartrand, Quebec’s coordinator for the International Association of Machinists and Aerospace Workers, wrote to Prime Minister Justin Trudeau on June 15 to express concern about the future of aerospace in Canada and to request that the federal government bring together industry players to develop an emergency plan targeting the industry.
“There’s been no word from Ottawa about any help for the sector,” said Suzanne Benoît, head of Aéro Montréal. “It’s dangerous. Every day counts.”
Aerospace is Canada’s third-biggest industry — after oil and automobiles — in terms of export revenue, with much of the manufacturing concentrated in Quebec. About 43,000 people work in aerospace in the Greater Montreal area, making it the world’s third-largest industry hub after Seattle and Toulouse, France. Quebec’s annual aerospace revenue totals about $15 billion, according to Aéro Montréal estimates.
Government assistance should primarily take the shape of additional export financing and direct support for small- and medium-sized suppliers, Balducchi said.
“The way Ottawa has abandoned the aerospace industry is lamentable,” said Mehran Ebrahimi, a management professor at Université du Québec à Montréal. “Canada has no aerospace strategy, and the sector is hostage to political battles. Most of the industry is concentrated in Quebec, so a federal government that helps aerospace is seen as helping Quebec. There is little social acceptability for financial aid at the national level.”
Chartrand, the union leader, joined officials from the Quebec government, the Bloc Québécois and the New Democratic Party in demanding action from Ottawa. His letter followed Bombardier Inc.’s announcement in early June that it would cut 2,500 jobs amid slowing demand for business jets.
Bombardier’s cutbacks provide “a glimpse of the catastrophe that awaits us if we let things deteriorate further,” Chartrand said in his letter. “Without concrete action, without putting in place a plan with a long-term vision, the very survival of our aerospace ecosystem is compromised.”
While acknowledging that aerospace is “one of the most innovative and export-driven industries in Canada,” a spokesperson for federal Innovation Minister Navdeep Bains offered no hint of any willingness to unlock funding for the sector. Instead, he referred to a series of programs announced by the Trudeau government — including the Business Credit Availability Program and the Canada Emergency Wage Subsidy — to help companies survive the crisis.
No industry has been hit harder by COVID -19 than aerospace. Airlines have grounded more than 70 per cent of the global fleet, laying off tens of thousands of employees while postponing or cancelling aircraft orders — affecting all members of the supply chain.