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Canada’s Aerospace Industry Profits to Dip in 2007

Nov. 14, 2007, Ottawa, Ont. – Following two years of growth, profits in Canada’s aerospace industry are expected to dip in 2007, before steadily improving next year, according to the Conference Board’s Canadian Industrial Outlook: Canada’s Aerospace Product Manufacturing Industry: Autumn 2007.

“The strong Canadian dollar and new competitors entering the global market are driving down prices, lowering industry profits to $389 million this year,” said Valérie Poulin, Economist. “Starting in 2008, profits are expected to bounce back on healthy production increases from soaring worldwide demand for business jets.”

Business jets≤those purchased for private use≤and their related components are expected to be the main driver of growth in Canada’s aerospace industry over the next four years. Canada’s regional jet production≤aircraft purchased by commercial airlines≤continues to show modest growth due to global competition and weaker demand.

 Profit margins will be thin by historical standards, averaging 4.1 per cent over the next 4 years, well below the double-digit margins achieved in 2000 and 2001.