Aereospace to remain in the black through recession
June 26, 2009 By Corrie
June 26, 2009, Ottawa - Canada’s aerospace industry is expected to post a modest profit of $620 million in 2009 according to the Conference Board’s Canadian Industrial Outlook.
June 26, 2009, Ottawa – Canada’s aerospace industry is expected to post
a modest profit of $620 million in 2009, despite declining demand for
business jets, according to the Conference Board’s Canadian Industrial
Outlook: Canada’s Aerospace Product Manufacturing Industry – Spring
“Although the aerospace industry is being affected by the recession, it
is currently faring better than many other industries,” said Valerie
Poulin, Economist. “However, the industry’s customers are beginning to
rethink or even cancel orders due to a decline in air travel and their
difficulties raising credit to pay for new jets. The next 12 months
will shape the industry’s longer-term well-being.”
Despite recent cancellations, the backlog of orders, which is
equivalent to nearly two years of production, is still just below the
industry all-time high. Industry production is expected to slow in the
next two years, but output will still outperform the rest of the
manufacturing sector. After an increase of more than 10 per cent in
2008, production growth is expected to slow to 1.7 per cent this year
and decline slightly in 2010.
Profits fell to $592 million in 2008 and should remain relatively
stable over the next two years. Profit levels are expected to grow
steadily beginning in 2011. However, profit margins remain slim—they
fell to a low of 2.7 per cent in 2008—and expected to average only
three per cent annually over the next five years.
Canadian Industrial Outlook: Canada’s Aerospace Product Manufacturing
Industry-Spring 2009 is sponsored by the Aerospace Industries
Association of Canada, the national trade association representing
Canada’s aerospace manufacturing and services sector.