This is a best prospect industry sector for this country. Includes a market overview and trade data.
Last Published: 9/30/2019

Overview

Canada is the world’s fifth largest aerospace market with $22.4 billion in revenues in 2017 supporting 190,000 jobs. Canada holds the #1 rank worldwide for civil flight simulator production, #3 rank in civil aircraft production and #3 rank in civil engine production. Montréal is the world’s third largest aerospace hub after Seattle, Washington and Toulouse, France.

Canada’s aerospace sector activities are divided into three main categories: 86 percent is civil aerospace, 12 percent is defense aerospace, and 2 percent is space. Defense aerospace sales account for over 30 percent of Canada’s total defense sales. In terms of subsectors, 68 percent of the industry’s activities are in aircraft manufacturing (civil, defense and space), 32 percent are in aircraft maintenance, repair and overhaul (MRO) (civil and defense). It is noteworthy that the MRO subsector has grown at the rapid pace of 26 percent over the last seven years (2010 to 2017). In terms of geography, Canada’s aerospace sector is spread out throughout the country, with large concentrations in Québec, Ontario, and Western Canada. Over 50 percent of Canada’s aircraft manufacturing occurs in Québec and 28 percent in Ontario, and 43 percent of its aircraft MRO occurs in Western Canada. In 2017, the sector spent $1.3 billion in R&D, accounting for nearly a quarter of all R&D spent by all of Canada’s manufacturing sectors combined. Aerospace is seven times as R&D intensive as the national manufacturing average.

The United States aerospace supply chains are highly integrated with those of Canada. Over the last five years, Canada is consistently ranked in the top 5 export markets worldwide for U.S. companies. In 2018, Canada was the United States’ fourth largest export market for U.S. aerospace exports, accounting for nearly US$10 billion in U.S. exports, a 7.6 percent increase from 2017. In fact, the United States is Canada’s largest foreign supplier; close to 60% of all Canada’s aerospace imports are from the United States.

In 2019, Canada announced its participation in NASA’s Lunar Gateway program by committing $1.5 billion over 24 years to build and operate a space robotic arm. Canada is also developing advanced space robots with artificial intelligence, space medicine, and a new generation of satellites with greater capabilities in earth observation, telecommunications, and space situational awareness.

Production in the Canadian civil aerospace market is forecast to outpace the global market for the 2014-2021 period. This phenomenon is due to the rise in the need for civil aircraft, particularly the single-aisle, short- to mid-range categories. As the population around the world becomes more urban and the middle-income class grows, a significant increase in demand for civil aviation products and services is occurring. Canada is a manufacturer of the types of civil aircraft (mentioned above) that are in growing demand.

For more information on the Canadian aerospace sector, visit:
https://www.trade.gov/topmarkets/pdf/Aircraft_Parts_Canada.pdf

Table: Canada Aerospace Production Data (US$ Thousands)

 201620172018 (Estimated)2019 (Estimated)
Total Local Production21,55722,36823,20924,081
Total Exports11,71212,24212,70013,150
Total Imports10,84211,33111,74612,200
Imports from the US8,4709,2489,9559,760
Total Market Size20,68721,45722,25523,131
(total market size = (total local production + imports) - exports)
US$ thousands / Exchange Rate: US$1 = C$1.2957

Leading Sub-sectors with Greatest Export Potential

  • Civil Aircraft Parts, Systems and Sub-Systems
  • High Tech: Advanced Materials, Manufacturing 4.0 Machinery, Cyber Security
  • Maintenance, Repair and Overhaul
  • Synthetic Pilot Training and Simulation Parts and Services
  • Space Commerce: satellite manufacturing parts, nanorobotic parts, radars and imagery, big data

Regulatory Framework

There are several U.S.-Canada agreements which make it easier for U.S. aerospace companies to do business with Canada than with any other foreign partners. Canada is a signatory to the WTO’s Trade in Civil Aircraft Agreement and pledges to free trade. A U.S.-Canada aviation safety agreement facilitates airworthiness approval by Transport Canada of FAA-approved U.S. aerospace products. The Defense Production Sharing Agreement allows U.S. and Canadian companies to jointly work on the research and production of defense aircraft. The agreement also allows U.S. companies to bid on government procurement in Canada. More info: www.ic.gc.ca/eic/site/ad-ad.nsf/eng/ad01691.html. U.S. companies can export International Traffic in Arms Regulations (ITAR) items to Canada more easily due to Canada’s ITAR Exemption.  More info: www.pmddtc.state.gov/licensing/documents/exports_canada.pdf.

Opportunities

There are many opportunities for U.S. exporters in Canada’s aerospace market. U.S. companies can best capture business opportunities by participating in local trade shows and industry events, as well as through establishing distributors, representatives, or partnerships with Canadian aerospace companies. When seeking opportunities to sell to the Canadian government, U.S. exporters can search for tenders at https://buyandsell.gc.ca/.

Upcoming Events and Trade Shows in Canada
2019 Aerospace Defence & Security Expo
https://adse.ca
Abbotsford, British Columbia
August 9-10, 2019

DEFSEC Atlantic
http://defsecatlantic.ca 
Halifax, Nova Scotia
October 1-3, 2019

Canadian Aerospace Summit
https://aiac.ca/events/canadian-aerospace-summit/
Ottawa, Ontario
November 12-13, 2019

Aerospace Innovation Forum
https://www.aeromontreal.ca/innovation-forum-2018.html
Montréal, Québec
April 2020

Web Resources

Aerospace Associations
Aerospace Industries Association of Canada:  www.aiac.ca
Air Transport Association of Canada:  www.atac.ca
Aero Montréal: www.aeromontreal.ca  
Alberta Aviation Council:  www.albertaaviationcouncil.com 
Atlantic Canada Aerospace and Defense Association (ACADA):  www.ac-ada.ca 
Canadian Business Aviation Association:  www.cbaa-acaa.ca
Canadian Association of Defense and Security Industries (CADSI):  www.defenceandsecurity.ca 
Canadian Council for Aviation and Aerospace (CCAA):  www.avaerocouncil.ca/
Consortium for Aerospace Research and Innovation in Canada (CARIC):  www.caric.ca
Consortium for Research and Innovation in Aerospace in Québec (CRIAQ):  www.criaq.aero 
Green Aviation Research and Development Network (GARDN):  gardn.org/
Manitoba Aerospace Association:  www.manitoba-aerospace.mb.ca 
Ontario Aerospace Council: http://theoac.ca/ 
Pacific Northwest Aerospace Alliance (PNAA):  www.pnaa.net/ 
Unmanned Systems Canada:  unmannedsystems.ca/

Canadian Government Federal Departments 
Transport Canada:  www.tc.gc.ca/eng/civilaviation/opssvs/aircraft-menu.htm 
Public Services and Procurement Canada:  www.tpsgc-pwgsc.gc.ca/comm/index-eng.html 
Innovation, Science and Economic Development:  www.ic.gc.ca 

For additional information on civil/dual-use commercial aerospace, please contact Commercial Specialist Gina Bento at Gina.Bento@trade.gov; tel.: (514) 908-3660.

For additional information on military aerospace, please contact Commercial Specialist Luz Betancur at Luz.Betancur@trade.gov; tel.: (613) 688-5411.

 

Prepared by our U.S. Embassies abroad. With its network of 108 offices across the United States and in more than 75 countries, the U.S. Commercial Service of the U.S. Department of Commerce utilizes its global presence and international marketing expertise to help U.S. companies sell their products and services worldwide. Locate the U.S. Commercial Service trade specialist in the U.S. nearest you by visiting http://export.gov/usoffices.