Industry New Brunswick's aerospace sector generating annual sales of $135 million, while drawing in new investments and businesses

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JOHN SHMUEL
TELEGRAPH-JOURNAL

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SAINT JOHN - As industrial machinery at pulp mills is silenced and a slumping fisheries sector is leaving boats tied to docks, one industry in New Brunswick continues to soar successfully above the recession.

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Adam Berry/Bloomberg News

The 48th International Paris Air Show in Le Bourget, France, ran last month, from June 15 to June 21. The biennial event is the world’s largest airshow – it attracts the global aviation community and provides an excellent opportunity to interact and exchange information with other firms.

New Brunswick's aerospace sector has flourished in recent years, and together with an advanced technology cluster that includes defence and security, it annually generates $135 million in sales. Compare that to 2004, when sales hovered just below $88 million.

Its rapid growth, driven by a plethora of aerospace companies that have set up shop and continue to grow in the province, highlights how the industry is quietly taking its place as a significant player in New Brunswick's economy.

"It was not something that just happened overnight. It took significant investments on the part of the province, the federal government and the private sector," says Louis Cuppens, a retired lieutenant-general who is now president of the New Brunswick Aerospace and Defence Association.

In clear defiance of trends throughout the rest of the manufacturing sector, aerospace in Canada is forecasted to witness growth this year, says the Conference Board of Canada in a recent report. The industry will post a $620 million profit this year, an increase over the $592 million it generated in 2008.

One of the reasons the industry remains healthy is because of its rapid response to the recession. Many aerospace companies like Bombardier, Boeing and Gulfstream shed thousands of jobs to address declines in orders for commercial and private jets.

The majority of aerospace firms in New Brunswick have avoided that fate however.

Cuppens explains that aerospace companies in the province are mostly lower-tier manufacturers - meaning that they build the smaller, complex parts of a plane, rather than delivering a completed jet the way an aircraft maker like Bombardier does.

The sector's health in New Brunswick has consequently drawn new investments and businesses to the province.

Mike Tilley, president of CANLink Aviation Inc., which he founded in 2007, says he chose New Brunswick to set up shop after looking at several alternatives because of an attractive business climate for aerospace companies.

"I would certainly say the opportunity for us was a good one," he says. "We were able to attract some business from China, and that business opportunity was quite significant. We've enjoyed success working in the aerospace sector in New Brunswick, and it's still fairly early for our company."

Tilley hopes to see the province attract a major aerospace company to set up shop in New Brunswick, saying that would show the government is serious about continuing to foster growth in the sector.

Regardless, he believes that the industry has a bright future ahead of it. Tilley just returned from a recent visit to the Paris air show, where he says a number of networking opportunities opened up for his company.

New Brunswick's aerospace industry is not without potential obstacles however.

Cuppens admits there are challenges facing aerospace in the province going into the future, including a global decrease in demand for business jets. He says that might cause aerospace to witness slower sales later this year or in 2010, but that overall the industry will remain healthy.

"While you might see the executive jet industry diminish, the major airlines are recapitalizing, and as well, many of the military air forces like our own are recapitalizing. So there's a tremendous demand for product at the present time," he says.

Cheryl Woods, executive director for the New Brunswick Aerospace and Defence Association, said that aerospace, combined in the advanced technology cluster of defence and security, was forecasted to see revenue in excess of $150 million this year. And although that will likely change due to the recession, job employment remains strong with close to 1,000 people now working in the industry.

"Aerospace is Canada's leading advanced technology exporter. Almost 80 per cent of its output goes to the export market," she says, adding she expects the sector in New Brunswick to continue to see healthy growth.