Turbocharged

With massive projects in the works from two major companies, and hundreds of new jobs on the horizon, Montreal's booming aerospace industry is flying high

CRAIG SILVERMAN
December 5, 2008

MONTREAL -- Benoît Brossoit says it's too early to give a tour of the construction site for Pratt & Whitney Canada Corp.'s new facility in Mirabel, but he promises that will change very soon.

By this time next year, Pratt & Whitney's senior vice-president of service centres and operations expects the company to be running a 300,000-square-foot plant that will assemble and test its next-generation aircraft engines - and also create 565 new jobs in Montreal's soaring aerospace industry.

"It's the largest engine Pratt & Whitney Canada has ever built or designed and we needed world-class facilities and infrastructure to be able to produce it," Mr. Brossoit says.

One thing that made Mirabel, an area north of the island of Montreal, stand out as the right place for the new plant was the friendly - and busy - aerospace community.

"Greater Montréal is one of the rare places in the world where virtually all the components for an aircraft can be found within a 30-kilometre radius," notes Aéro Montréal, a private-public partnership that bills itself as the local industry's think tank.

Cluster of success

As a result, Montreal is now the world's third-largest aerospace cluster, behind Seattle and Toulouse, France.

"With everything going on with the recession, it's very encouraging to be in this sector because we aren't feeling any slowdown at this juncture," says Suzanne Benoît, chief executive officer of Aéro Montréal.

"The order book [for new aircraft] is full until 2013, so everybody is working."

Until recently, Mirabel held a dubious place in Canadian aviation history thanks to the moribund Mirabel Airport, one of the country's most infamous economic follies. Though it failed as an air-travel hub, the area is being reborn as an important testing and assembly centre for aerospace companies.

In 2001, Bombardier Inc. opened its own 300,000-square-foot Mirabel complex, which performs final assembly for its regional airliners. Bombardier has also announced plans to build another facility to complete final assembly for its new CSeries jets.

And Bell Helicopter Textron Canada Ltd., another major player in Montreal's aerospace sector, produces more than 200 helicopters per year at its Mirabel plant, which opened in 1986.

Montreal has been home to airplane manufacturers since the 1920s, and that long-term industry presence has helped the region grow to become home to more than 200 aerospace companies that account for 60 per cent of the total aerospace production in Canada.

Large original equipment manufacturers such as Bombardier, Pratt & Whitney and Bell Helicopter are joined by flight-simulator giant CAE and smaller companies that provide everything from landing gear to aircraft interiors.

Montreal also boasts the headquarters of the Canadian Space Agency, and an array of universities and technical schools that churn out specialized aerospace engineers, technicians and MBAs.

'Hanging tough'

Despite the current tough economic climate, aerospace continues to be one of the bright spots of the Canadian manufacturing sector. In June, the Conference Board of Canada predicted the nation's aerospace industry would "post its highest profit level in five years" in 2008.

"The global aerospace industry is hanging tough despite the slowing U.S. economy, and Canada is landing its share of the market," Valerie Poulin, a Conference Board economist, said in the report.

The North American market for new aircraft is expected to slow over the next few years, but countries such as China, Russia and India continue to drive the market for business and commercial planes.

"In 2002, 60 per cent of the owners of business aircraft were based in North America, with 40 per cent internationally," says Marc Duchesne, a spokesman for Bombardier Aerospace. "In 2007, 30 per cent were in North America and 70 per cent of owners were international."

He says that as of July, Bombardier had $26.1-billion worth of firm orders for its business and commercial airplanes.

Along with Pratt & Whitney's October announcement that its new, lower-emission engine would be manufactured and tested in Montreal, the biggest news to hit the industry came this summer when Bombardier formally announced plans for its new CSeries of commercial jets.

'This is the future'

Bombardier says that compared with all current offerings currently on the market, the 100-to-149-seat CSeries will be four times quieter, use 20 per cent less fuel, and reduce carbon dioxide emissions by 20 per cent.

"This is the future," says Mr. Duchesne, referring to the fact that the CSeries jets are expected to cost airlines 50 per cent less to operate than existing planes.

But he could just as well be talking about what the new planes mean to the Montreal industry.

The high cost of fuel and other operating expenses, along with the desire to reduce the environmental impact of air travel, means that Montreal companies need to lead the way in creating next-generation aircraft if the region is to continue its growth.

"It is exactly the right time to work on this aircraft because once the economy [improves], airlines will be looking for newer aircraft," Mr. Duchesne says.

"They need to renew their fleet and the CSeries will be in operation by 2013."

Bombardier already has 700 employees working on the project - up from just 40 earlier this year. By 2017, the company expects more than 3,000 employees to churn out one CSeries plane a day.

"For the CSeries, we will develop brand-new infrastructure and a new facility [in Mirabel]," says Fannie Jacques, human resources director for the CSeries project, which she calls "the biggest aerospace program in Canadian aerospace history."

Bombardier's big bet is also creating opportunities for other companies.

Pratt & Whitney Canada's new engines will power the CSeries jets, and smaller companies are looking for their share of CSeries work.

"We are bidding on contracts for the CSeries," says Joe Marcheschi, director of sales and launch programs for Avior Integrated Products Inc., a manufacturer of composites and sheet-metal structures with 240 employees in Laval and Granby, Que.

Avior has existing contracts with Bombardier, and also provides products to Bell Helicopter Textron, Boeing and Airbus, among others.

Thanks to a focus on international markets over the past six years, the company has doubled its annual sales to $27-million. Mr. Marcheschi says they could double again over the next five years.

Though deals with companies in Europe and Asia are driving company growth, he says the Montreal area continues to offer unique operating advantages.

"Here you have the capability to build an aircraft completely from scratch, and the subcontractors are located very close to the original equipment manufacturers," Mr. Marcheschi says. "They get savings from the proximity of suppliers, and there's a lot of back and forth."

The talent search

There's also an element of collaboration. The not-for-profit Consortium for Research and Innovation in Aerospace in Quebec matches aerospace companies with universities for research projects that result in the development of new technologies for the industry.

The consortium has 25 ongoing research projects, with many more under development, some of which include international partners.

"The industry needed to find a way to work together to develop competencies and also attract more students into the field," says André Bazergui, the consortium's CEO.

Attracting and training talent is a pressing concern for all of the industry players.

Bombardier Aerospace has hundreds of vacant positions. Pratt & Whitney Canada is staffing up for its new engine program.

Smaller companies such as Avior are also competing to lure the best talent, while Boeing and Airbus try to swoop in and recruit new graduates.

But the good news is the announcements of Bombardier's CSeries and Pratt & Whitney's new engines are spurring interest in aerospace education and training.

"After the Bombardier announcement there were lineups outside the technical schools to apply for the aerospace programs," says Ms. Benôit of Aéro Montréal.

"People want to get ready for the big boom."

From seaplanes to fighter jets to lunar modules

Canada's first aerospace company wasn't really an aviation company. Based in Montreal, Canadian Vickers was initially a shipbuilder. But in 1920, the company started an airplane division.

"At first they only built airplanes [using designs] licensed from other companies, but by 1924 they started designing their own products," says Pierre Thiffault, the author of Au temps des premières ailes, a history of aviation in Quebec.

"The first airplane produced and designed by them was the Vickers Vedette."

The Vedette was the first seaplane with an enclosed cabin, an innovation necessitated by the Canadian climate.

"We needed airplanes for the Canadian climate and the Americans and British couldn't do it," Mr. Thiffault says.

"We had to design our own airplanes that could fly farther in a harsh environment."

Canada's weather and geography also played a role in 1927 when the Quebec government began using planes to deliver mail to isolated regions of the province. The aircraft built by Fairchild, a U.S. company that had recently begun operations in Montreal, were engineered to fly long distances in the harsh winter climate.

"The planes had to fly over 700 miles [1,120 kilometres] in uncharted areas without any radios or airports that could help them in case of a problem," says Mr. Thiffault, noting that the pilots delivered the mail by flying low and dropping bags from the air. (With neither radios nor airstrips, pilots who were forced to make an emergency landing used carrier pigeons to send messages back to base.)

The air mail service was maintained during tough economic times in the 1930s, a decade notable for demonstrating the industry's resilience in the face of poor economic conditions.

The Dirty Thirties also saw the founding of Trans-Canada Airlines, now known as Air Canada, and the launch of the successful locally made Noorduyn Norseman single-engine bush plane.

The Second World War brought boom times to the Montreal industry thanks to the creation of military airbases throughout the province. In 1944, Canadian Vickers spun off its aviation division to create Canadair, which was sold to a U.S. company in 1946.

Soon after the end of the war, Montreal's growing reputation as an aerospace centre attracted companies such as Rolls-Royce and Bell Helicopter. Canadian Aviation Electronics (CAE) was founded in 1947 by Ken Patrick, a former Royal Canadian Air Force officer. (Pratt & Whitney Canada, meanwhile, had been in the city since 1928.)

The 1960s gave local companies the opportunity to play a role in the space race. Héroux Aviation, based south of the island of Montreal in Longueil, built the landing gear for the lunar modules used in the U.S. Apollo space program.

In 1976, Canadair returned to Canadian ownership when it became a Crown corporation. Over the years, the company had produced an array of fighter planes, transport jets and water bombers. In the 1980s, Canadair began selling the Challenger family of corporate jets.

This new business attracted the interest of another well-known Quebec company, which bought Canadair in 1986. The move echoed Canadair's origins at Canadian Vickers, in that its new owner was better known for other modes of transport. But by most accounts, Canadair has done well as Bombardier Aerospace.