Canada’s Aircraft and Aircraft Parts Industry: Industrial Outlook Winter 2006

Canada’s aircraft and aircraft parts sector has been recovering from some painful years that included the collapse in air travel after 9/11, the war in Iraq, the severe acute respiratory syndrome (SARS) outbreak, and soaring oil prices.

Although the high price of oil remains a challenge, the situation continues to improve for aircraft and aircraft parts manufacturers. Overall sector profits are expected to increase from an estimated $798 million in 2005 to $1.2 billion this year, because of healthy revenue growth, in part due to a rebound in shipments.

Profits will continue to grow over the forecast period, reaching $1.8 billion by 2010, as profit margins stay above 8 per cent from 2007 to 2010.

The outlook includes an update on restructuring in the airline industry and a look at the need for intermediary companies, which link dominant companies and smaller suppliers, to ensure the sector’s long-term prosperity.