Madam Chair, members of the committee and colleagues, good morning.
I am very glad to appear before you today representing Stelia Aerospace Canada. Thank you for inviting me and for taking an interest in Canada's aerospace industry, especially during these uncertain times, which will no doubt accelerate changes already under way around the world.
I'd like to start with an overview of Stelia Aerospace's organizational structure. We are a wholly owned subsidiary of the Airbus group. We supply metallic and composite aerostructures, as well as aircraft seating for pilots, and first class and business class passengers. We have the capacity to design, test, qualify, manufacture, equip and deliver completed aircraft sections and seat solutions directly in the last-stage assembly lines of our clients.
We employ some 7,000 people across 14 sites around the world, including nine manufacturing subsidiaries. Three of those nine subsidiaries employ a thousand people in Canada: first, Stelia North America, specializing in composite structures, employs 460 people in Lunenburg, Nova Scotia, and Blainville, Quebec; second, Stelia Aerospace Canada, specializing in aerostructure assembly, employs 180 people in Mirabel; and third, Stelia Aerospace St-Laurent, newly established in February 2020 and specializing in the assembly of A220 cockpits and rear fuselage sections, employs 360 people. We are transitioning to a new plant being built in Mirabel and slated for launch at the beginning of the third quarter of 2021.
Employees performing these direct jobs in Canada earn an average of $70,000 yearly. In addition, we contribute to more than 150 indirect jobs at our Canadian suppliers.
Owing to the global COVID-19 pandemic, our clients had no other choice but to postpone their orders after their clients—airlines and business jet clients— cancelled and delayed deliveries.
Our order volume and five-year forecasts have dropped drastically, more than 30% to date. Order cancellations and postponed deliveries have forced us to adapt very quickly, given that we had already invested in building a plant and acquiring cutting-edge technology to the tune of $61 million over three years. We are now in survival mode.
There is no doubt that had we had a clearer read on events, we would have done things completely differently.
The vast majority of revenues generated by Canada's aerospace industry flow from the demand for new aircraft from airlines and business jet clients. Orders are then placed with aircraft manufacturers, who, in turn, are our clients.
For that reason, we hope to count on three pillars of immediate support for the recovery. The first is strong demand for the construction of new-generation aircraft, along with direct and immediate assistance for buyers—in other words, airlines—and contract givers—aircraft manufacturers and original equipment manufacturers. This would ensure the short- and medium-term benefits were felt across the industry. This is a global strategy, one Canada should take part in to keep its own aerospace industry. The second pillar is direct support for financial obligations that we had previously incurred, that is, significant investments that were made before our revenues dropped by more than 30%. The third and final pillar is programming support to help us face the growing competition from emerging countries that boast low labour costs and low tax rates, as well as industrialized countries that invest heavily in concrete projects offering tax breaks.
Canada has long had a strong aerospace hub, bolstered by its aircraft, engine and simulator manufacturers, and in turn, their networks of local suppliers.
Given that the marketplace is more competitive than ever, I want to end by sharing some personal experience.
I was fortunate enough to have the opportunity to set up and run a number of aerostructure plants in emerging markets. These good-quality jobs are highly prized by countries such as Mexico, Tunisia, Turkey, the Kingdom of Morocco and several Asian nations, all of which invest heavily in growing their aerospace sectors. China decided to take it a step further and develop its own market of original equipment manufacturers.
Stelia chose Canada, first, because of its proximity to the client and, second, because of its aerospace expertise. Those conditions now exist in the countries I just mentioned, countries that are investing heavily in the aerospace sector and enhancing their own capacity.
We are at a turning point. It will be hard to make up the lost ground, but all is not lost. The government needs to create the conditions to protect what we have, while making our marketplace more attractive, competitive and productive.
Madam Chair, members of the committee, thank you for your consideration and your time.