Madam Speaker, when he was the federal industry minister, the late Jean Lapierre said that the aerospace industry is to Quebec what the auto industry is to Ontario. That is true, because we are talking about 40,000 direct jobs, 100,000 indirect jobs, 220 businesses, including 200 SMEs, and $18 billion in sales, of which 80% are exports. It is the leading exporter in Quebec. With 12% of manufacturing exports, Quebec accounts for 50% of jobs, 60% of sales, and 70% of research and development in Canada's aerospace sector. The sector funds 55% of industrial R and D in Quebec. The greater Montreal area is the third-largest aerospace hub on the planet after Seattle, with Boeing, and Toulouse, with Airbus. It is an integrated industry. There are only three places on earth where we can find suppliers capable of providing all the components to build an aircraft from nose to tail. The greater Montreal area is one of them.
Continuing with the statistics, the number of times that the term “aerospace” or “aviation” appears in the Speech from the Throne is zero. This industry is in trouble. It was already struggling, but COVID-19 has made things worse. Certain economic sectors will be affected for longer than others and will need special assistance. The aerospace industry is one of them.
The Speech from the Throne mentions culture, tourism and agriculture. We will see how that goes. We will see if rhetoric becomes reality, but at least they got mentioned.
The aerospace industry is probably one of the most important parts of Quebec's industrial landscape. Airlines are the primary clients of the civilian aerospace sector, and they are struggling. We know that planes have been grounded. There is no maintenance and no replacement parts. Orders for new planes are few and far between, and it will stay that way for years to come. Airlines that submitted orders are postponing taking delivery of the aircraft to avoid having to pay the balance.
Since the spring, 4,000 aerospace jobs have been lost. The industry resigned itself to creating ties with the construction industry so it could send workers there, at the risk of losing expertise and the ability to bounce back. That also means that there are SMEs that might end up closing their doors.
We have always advocated for an aerospace policy. What exactly is an aerospace policy?
I often talk about this, as did several of my predecessors assigned to this file. The government says it has already provided help. However, a real policy means more than providing sporadic help. It means more than providing funding here and there, no matter how much.
I will take the risk of explaining what a real aerospace policy is, in the Parliament of a country that is rather foreign to the concept of economic nationalism. Very few sectors are protected and supported and have a real strategy dedicated to them. The aerospace sector should be one of them.
Of all the countries with a significant aerospace industry, Canada is the only one without a policy to support its development. That is why the Bloc Québécois plans to raise this issue before the standing committee on industry in order to identify the challenges and the vision needed, thereby forcing the government's hand.
An aerospace policy means, first and foremost, a space where all stakeholders, including companies, workers and governments, have a seat at the table to convey their realities and needs. Ottawa already does this for the auto industry. It also means specific programs tailored to the reality of the sector. It means predictable support that allows stakeholders to anticipate and commit to longer-term projects. Of course, it requires a comprehensive vision that encompasses all the links in the chain, including a military procurement policy that strengthens the entire cluster. It means sharing the risks associated with the biggest projects. It means reviewing R and D support programs to ensure they are better adapted. It means credit for purchasers that buy aircraft from us.
Now, what do we want?
I want to suggest some ideas that we could put forward and debate. However, we would have liked to have seen some initial thoughts on this in the throne speech.
For example, there is recycling. To reduce the cost of keeping its planes airworthy, Air Canada removed 80 planes from its fleet. They are going to be sent to an aircraft boneyard in the Arizona desert. However, there is a company in Mirabel that dismantles and recycles planes. It is the only such company that is certified in North America.
The accelerated removal of aircraft presents an opportunity if Ottawa decides to place environmental conditions on its assistance to airlines. This is in keeping with the very appropriate proposal put forward by my colleague from Repentigny. Hundreds of technicians could continue to work in the field rather than having to seek work elsewhere until things take off again.
With regard to climate change, France put a condition on its seven-billion-euro bailout for Air France. Air France was told that the assistance was conditional on the preparation of a plan to make its fleet greener. If Ottawa had a similar program, it would guarantee sales of the A220, which is built in Mirabel and is the most fuel-efficient and environmentally friendly aircraft in its class. In Quebec, going green pays off.
I also want to talk about maintenance. Over the years, airlines have outsourced most of the heavy maintenance on their aircraft. The closure of the Air Canada maintenance centres in the late 2000s cost this country 3,600 jobs, 2,500 of which were in Quebec. Members will recall the Aveos saga. Today, those same airlines are knocking on the government's door looking for an aid package. We could take advantage of that to rebuild our industrial sector.
Of course, they need cash flow too. We can expect major buyers to slow their activities during the crisis but to get through it eventually. Unfortunately, for the 200 SMEs in this sector that supply parts and components, the future is much less certain. If a supplier goes out of business, the part it supplies will not be available for planes. We are in danger of losing our ability to build an aircraft from nose to tail, which is something we are proud of and known for.
As I was saying, only three places in the world have that ability, and the greater Montreal area is one of them. The sector is highly integrated, so only an integrated policy will properly address its unique characteristics.
We need loans for buyers too. Airlines that have A220s are pretty much flying only those planes. Not only are they more fuel efficient, making them cheaper to fly, but they are also well suited to the pandemic. The A220 is the only plane that can replace the cabin air in flight. Other planes recycle their air. I am sure we can all agree that that is a priceless advantage during a pandemic.
Airlines with no cash flow are not accepting delivery of the aircraft they ordered so that they do not have to pay the balance. The yard next to the plant in Mirabel is full. There are 16 aircraft parked there, ready for delivery, because the buyers cannot yet take possession. If they had credit, there is a good chance that they would do so. That would be a solution.
We must also consider the defence sector. A number of businesses in the aerospace industry supply to both the civilian and defence sectors, in the areas of manufacturing and maintenance. Logically, the defence sector is less dependent on economic cycles than many other sectors. It provides more stable revenue, which helps companies through crises. Ottawa is preparing to replace its aging CF-18s. Strict local content requirements would give our industry a much-needed boost.
I also want to talk about research and development. The aerospace industry is very technology intensive. Designing an aircraft can take 10 to 15 years. The research and development of an aircraft is paid off in the years the aircraft is on the market. Under this business model, revenue pays for the previous research project, but what company is going to go into more debt to work on the next project? To reap the technological spinoffs, SMEs need to get in on a project during the early phases to design the part they will supply to the contract givers once the aircraft goes to market. They also need to incur debt in order to participate.
In times of crisis, research is the first thing a company will cut, since there is no immediate return on investment. This business decision makes complete sense. No one would disagree that the research and development tax credit is a good thing, but it does not generate cash flow in times of crisis. Direct assistance is required if we want to keep our companies from being downgraded once we emerge from this crisis.
Of course, better tailored programs are needed. The research and development tax credit provides assistance for the development of a new product, but it is not available to those who want to improve an existing product. It should also be noted that this credit does not cover everything. For example, it does not cover costs such as—
