The Québec aerospace sector

• 1. Leadership
• 2. Cohesion
• 3. A pool of talent
• 4. Innovation
• 5. Incentives

1. Leadership

A long tradition of innovation sustained by businesses recognized the world over

Sales

• Average annual growth in sales of 5,6% (1994-2019)
• Total annual sales of $17.8 billion (2019)
• 57% of Canadian aerospace sector sales (2019)
• More than 80% of Québec aerospace industry output is exported outside Canada (2019)

The presence in Québec of world leaders

The Québec aerospace sector comprises six major prime contractors, 15 Tier 1 partners, equipment manufacturers and major maintenance-repair-overhaul (MRO) service providers, and 219 suppliers (SMEs).

Prime contractors:

• Airbus (commercial aircraft);
• Bombardier (business aircraft);
• Bell Helicopter Textron Canada (commercial helicopters);
• Pratt & Whitney Canada (aircraft engines);
• CAE (flight simulators and training services).
• Mitsubishi Aircraft Corporation (regional aircraft)

International government organizations

Several major international aviation organizations are located in Montréal:

• the International Civil Aviation Organization (ICAO);
• the International Air Transport Association (IATA);
• Airline Telecommunication and Information Services (SITA);
• the International Business Aviation Council (IBAC);
• the Airports Council International (ACI).

A strategic geographic position

One of Québec’s strengths is its geographical location in the heart of the North American market, the biggest in the worldwide aerospace sector. Assembly plants operated by major aircraft manufacturers, in particular Airbus, Boeing and Bombardier, and manufacturers in the corporate aviation, aircraft engine, helicopter and space sectors, to name but a few, are located in Canada and the United States.

2. Cohesion

An ecosystem of businesses big and small at several stages of the value chain

Unique synergy between stakeholders

Québec, and in particular the Greater Montréal area, possesses a genuine aerospace community that has over the years structured itself around its stakeholders’ strengths:

• world leaders and dynamic SMEs;
• Aéro Montréal, a strategic consensus-building forum, which groups together all of the stakeholders in the industrial cluster and represents them among various contacts, in particular governments and the media;
• the Comité sectoriel de main-d’œuvre en aérospatiale du Québec (CAMAQ), which responds to the sector’s manpower and training needs by facilitating collaboration between the representatives of businesses, the unions and educational institutions;
• the Consortium for Research and Innovation in Aerospace in Québec (CRIAQ), whose initiatives are carried out in collaboration with key industry stakeholders to optimize collaborative research between the universities and the sector;
• several educational institutions that offer varied aerospace programs, including the École des métiers de l’aérospatiale de Montréal at the secondary school level, the École nationale d’aérotechnique at the college level and, at the university level, the École de technologie supérieure, the École polytechnique de Montréal, Concordia University, Université Laval, McGill University and the Université de Sherbrooke;
• several organizations that support innovation in SMEs, such as the Centre technologique en aérospatiale (CTA) and the National Research Council of Canada’s Aerospace Manufacturing Technologies Centre;
• prestigious international organizations active in the aviation sector, including the International Civil Aviation Organization (ICAO), the International Air Transport Association (IATA), and the International Federation of Air Line Pilots’ Associations  (IFALPA).

The 2016-2026 Québec Aerospace Strategy

• The 2016-2026 Québec Aerospace Strategy stems from a collective mobilization and consensus-building initiative between industry partners to contribute to Québec’s long-term prosperity and enable it to raise its profile the world over. The industrial development strategy is organized around four strategic priorities and draws on a budget allowance of nearly $250 million until 2021:
  1. Strengthen and diversify the industry’s structure;
  2. Foster the industry’s growth by supporting projects and investing in manpower;
  3. Guide the development of SMEs;
  4. Rely on innovation.

3. A pool of talent

Multilingual, qualified, stable manpower

Sought-after workers

The Québec aerospace sector’s foremost asset is without question its skilled workers, who benefit from quality, top-notch training offered by universities, colleges and vocational schools that are well aware of the sector’s needs and the changing international market.

Highly skilled jobs

• 43 400 jobs (2019)
• 49% of Canadian aerospace sector jobs (2019)
• Average annual growth of the workforce of 3.2% for SMEs and 1.1% for prime contractors, Tier 1 partners and major maintenance-repair-overhaul (MRO) service providers (1994-2019)
• One worker in 100 is employed in the Québec aerospace sector
• One worker in 50 engages in a trade or profession in the aerospace sector in the Greater Montréal area

4. Innovation

A sector based on knowledge, creativity and innovation

Canada’s aerospace research hub

• More than 70% of Canadian aerospace R&D is conducted in the Greater Montréal area

A productive innovation system

Innovation is an essential key to the sector’s competitiveness and Québec is determined to take full advantage of its resources in this respect in order to profit from future growth in demand in the aerospace sector. Supported by key organizations such as the CRIAQ, industry stakeholders are very active in research and development (R&D), as the significant share of Canadian aerospace R&D conducted in Québec attests.

5. Incentives

Advantageous taxation, abundant venture capital and low operating costs

Advantageous taxation and operating costs

The Québec aerospace sector can rely on advantageous tax incentives and operating costs to attract and encourage investments. Taxation and operating costs are decisive factors when companies decide where to establish a new subsidiary or carry out a megaproject. Québec and Montréal offer significant competitive advantages.

In the most recent biennial edition of its study Competitive Choices, KPMG ranks Québec City and Montréal first and fourth from the standpoint of operating costs in the manufacturing sector, compared with several cities in the northeastern United States and Canada. In the same study, KPMG ranks Montréal third in terms of cost competitiveness in relation to the main international cities. In Canada, Montréal ranks ahead of Toronto and Vancouver. In the international ranking, only two Mexican cities rank ahead of Montréal.

Québec also offers attractive fiscal measures for manufacturing companies, which directly benefit the aerospace sector. The key measures are:

• the tax holiday for major investment projects;
• the scientific research and experimental development tax credit;
• the tax credit for precompetitive research projects carried out under private partnerships;
• tax holidays for foreign researchers and experts.