OTTAWA – Canadian aerospace companies require a government-led industrial strategy to grow their services nationally and internationally, executives warned at a panel today at the Canadian Aerospace Summit of the Aerospace Industries Association of Canada (AIAC).
While the industry is strong enough today to stand on its two feet, representatives from IMP Aerospace & Defence, Telesat and Avcorp pointed to a sector in turbulence as companies consolidate, original equipment manufacturers (OEMs) fight to stay alive in Canada, and technology continues to push aerospace into new directions.
At Telesat, the company expects a major shift in its satellite network operations. Instead of operating 17 geostationary satellites, as it does today, Telesat is prepared to deploy a network of hundreds of low-Earth-orbit communications sentinels to make the network more robust and responsive.
“Our customers are all looking for almost the same thing nowadays, which is a very fast, very low-cost ubiquitous reliable broadband connectivity,” said CEO Dan Goldberg, adding that the challenge is company is facing is evolving the service offering to meet these needs.
Some of the key technologies include digital processing, phased array antennas and optical communications, he added. While there are a number of Canadian companies that do business in those sectors with Telesat today, those firms will require “a big investment” from government to stay competitive. These technologies do have applications on Earth, he added, such as in high-speed cellular networks.
Meanwhile, OEMs are challenged to stay afloat in aerospace due to the ongoing rush to reduce costs, which often drives these firms to seek cheaper opportunities overseas, said David Gossen, president of IMP Aerospace, which provides engineering and maintenance support to the Canadian Department of National Defence and international customers.
“The days of long-term partnerships, those have seemed to go by the wayside,” Gossen lamented. He said that Canadian companies will need to distinguish themselves with unique intellectual property to stay competitive. One key segment could be expanding build-to-print manufacturing, he said.
IMP doesn’t work in a free trade environment, Gossen added, as the industry is shaped by geopolitical issues. Military markets, even for North Atlantic Treaty Organization (NATO) partners, are closed due to sovereignty concerns.
Gossen said he also needs to be responsive to shareholder concerns (a common problem among CEOs in all industries); he said he would prefer to invest in Canadian technology, but without government spending in that sector, it will be difficult for Canadian firms to stay competitive. International partners get those advantages from their own governments, he said, so it would make sense for the Canadian government to do the same.
Amandeep Kaler, the newly appointed CEO of Avcorp, said he continues to differentiate his firm through hiring people who have unique background and experiences that they can then provide to customers. However, his business is also under pressure from emerging markets that are hungry to grab a piece of the aerospace market. Canadians do have technologies here that they can leverage – automation being an example – and should continue to work hard in these niche areas to be differentiated, he said. “It brings better solutions to our customers,” he said.
The panelists also called on the Canadian governments to “make bets” in technologies that will benefit the country in the future, including traditional areas of strength for our country (robotics) and those areas that will be of growing importance to worldwide technology in the future (artificial intelligence).
“These are high-paying, innovative, technologically based exportable jobs, so there will be some winners and losers, but we cannot be afraid to make those bets,” Gossen said.