Transport Committee on Oct. 16th, 2012

[Pierre Seïn Pyun]

It depends on the type of research. Maybe Paul can add to that. When we're working on a product like an aircraft, for instance, a lot of the design engineering work would be done in-house, with the support of suppliers, because in the aerospace sector we're moving towards a risk-sharing partnership model, where our key suppliers also take on some of the design responsibilities.

[Jeff Watson, Conservative, Essex, ON]

It’s similar in the auto industry.

[Pierre Seïn Pyun]

Yes.

In terms of collaboration with universities, the research and development programs could be at different stages. Maybe in some cases we're doing research less close to commercialization, but for a company like Bombardier it's always with a view to commercializing those technologies.

In terms of support or collaboration with the government, I think there needs to be a balance between a more demand-pull approach, like using government procurement as a policy tool—

[Jeff Watson, Conservative, Essex, ON]

Are you familiar with Fraunhofer as a model in Germany, for example?

[Pierre Seïn Pyun]

To some extent, yes.

[Jeff Watson, Conservative, Essex, ON]

It's a little more entrepreneurial, would be my assessment of it in a quick read. Is that a model that would be more favourable to what you aspire to do with respect to research and development, for example, than say the granting council, university, research push model of R and D?

[Pierre Seïn Pyun]

I think the flip side of the coin is the technology push approach as well, so programs to support, particularly, demonstration projects. I think there's a funding gap here in Canada for that segment of the innovation spectrum. Our view is there needs to be a balance between the two, and certainly there's scope in Canada to use government procurement more as a tool to achieve some innovation objectives.

Coming back to your comment about the size of the Canadian market, I think part of the equation has to be the export markets as well. When we export or when we do business in foreign countries...if you don't have reference projects here in Canada, it's very difficult for any Canadian firm to be able to compete. We develop technologies here in Canada, yes, for the Canadian market, but I think we have to bear in mind that there are export opportunities for a country like Canada that relies on trade.

[The Chair, Conservative, Larry Miller]

Thank you very much.

Mr. Aubin, go ahead.

[Robert Aubin, NDP, Trois-Rivières, QC]

Mr. Chair, I will be sharing my time with Denis.

I would like to ask a question so that we have time to go over the issue.

Let us go back to the wheel motor project. What type of funding do we need to move ahead with the research? How long do you think it would take for it to become available? Who pays the bill and how do we connect with the other provinces?

We really are actually thinking of a national public transit strategy.

[Etienne Couture]

A pilot project should be developed. As our colleague from Bombardier said, demonstration projects that become exportable are part of the most significant showcases. That has to be harmonized nationally. This goes back to the comment from the beginning: a Canada-wide strategy would pull it all together; if we follow local or provincial initiatives, we lose the opportunity to show Canadian leadership.

[Robert Aubin, NDP, Trois-Rivières, QC]

Do you have any idea of what kind of budget we would need for this to become reality?

[Etienne Couture]

No, I don’t have any figures off the top of my head.

[Mike Sullivan, NDP, York South—Weston, ON]

Ultimately, it's electricity that's the saviour to a lot of this. We're not going to get high-speed rail without electric trains. We're not going to get a reduction in greenhouse gases without electric trains. We're not going to get a reduction in pollutants in urban centres if we're running diesel trains. That's part of why there's a group in Toronto called the Clean Train Coalition, which has been pushing the provincial government very hard to move to electric-based rail systems for its regional rail in the city of Toronto. So far it's extremely difficult in Canada to move that yardstick.

What is it going to take to actually create the infrastructure, to build that infrastructure? The freight railroads don't really want to. They're happy with diesel. They're just going to keep charging more and more. The City of Montreal wants an almost entirely electric transportation system within 10 years. They have the right vision. What are we going to need to do federally to make it happen more universally across the country?

[Etienne Couture]

I would like to answer that question.

First, electrification is inevitable; it is going to happen. The three major car manufacturers in North America are heading that way. Here in front of us, we have Bombardier, which is already ready for electric-engine vehicles. So it is an inevitable trend.

The question is whether we are going to end up at the back of the pack or whether we are going to be the leaders. What direction will Canada take in this area? The leadership has to be expressed and identified. Canadian regulations and initiatives have to demonstrate that willingness.

Let’s take the Champlain bridge in Montreal for example, which is now being renovated. If they don’t make room for electric public transit, they will miss the opportunity and they will have to redo it. Today we have to use the projects before us to turn into potential exports.

[Mike Sullivan, NDP, York South—Weston, ON]

It's that forward-looking leadership that your organization hopes to bring towards us, so that we can listen to you and bring that.... You talked about the Champlain Bridge. The Bloor Street Viaduct in Toronto is a great example of forward-looking politicians, who, in the 1920s, built a bridge with a subway track underneath it. The subway wasn't built until the 1950s, but the bridge was there. They knew exactly what was going to be necessary. I guess that's what you're saying. In everything we do as a federal government, in everything we do, whether it's procurement at a local, provincial, or federal level, or whether it's procurement using federal dollars, provincial dollars, or municipal dollars, we have to be generating this nexus of innovation in Canada using Canada as the leader of the world rather than the back end of the world.

I'm glad to hear you.

What obstacles are there? Can you think of any one thing that we should just remove and we're on the way?

I know it's hard.

[Etienne Couture]

We particularly want to demonstrate this willingness, this leadership. It is not as if there were roadblocks in the way, preventing things from moving forward. When we take the lead, and demonstrate our clear desire to act, investments and the private sector will follow. It is as simple as that.

[The Chair, Conservative, Larry Miller]

Thank you very much.

Mr. Poilievre, for five minutes.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

I'd like to ask a question to our guest from Better Place. How much public funding has gone into the electrification initiative of which you are part?

[Jason Wolf]

The answer is, to Better Place, nothing. When I say “nothing”...we've raised $750 million from private equity investments. We got $50 million from the European Investment Bank as a loan. For my operation in North America we did get a few federal and local grants to build pilots, but in the commercial networks that we've launched, out of that $800 million there's been no public money.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Your company is instrumental in this Israeli effort to electrify the retail vehicles in that country. Is that right?

[Jason Wolf]

Yes, absolutely.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

How much public funding has that initiative received?

[Jason Wolf]

Zero.

[Pierre Poilievre, Conservative, Nepean—Carleton, ON]

Zero? So the entire fleet of retail vehicles that Israelis are driving that are electric and battery-powered are entirely from private funds.

[Jason Wolf]

They're 100% from private funds.