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EADS unit to build Bombardier jet components in Quebec

Bombardier Global 7000 and Global 8000 business jets


Quebec has beat out Ontario in a contest to get a major European aerospace manufacturer to build a fuselage-assembly facility, and company officials say government funding secured the win.

Toulouse-based Aerolia -- a subsidiary of EADS, which also makes the Airbus -- said Thursday it will build in the Montreal region its assembly plant for the centre fuselage for Bombardier Inc.'s new Global 7000 and 8000 corporate jets.

Aerolia officials were effusive in their praise for the Quebec government for providing $15-million in financial support, $5-million of which is non-refundable.

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"There was support from Quebec that made the difference," said Aerolia spokesman Philippe Le Gregam.

In a news release, Aerolia said it wishes to "express all its gratitude to the Government of Quebec for all its efforts in setting up appropriate conditions for the development of Aerolia Canada."

Total value of the project is $82.4-million. About 150 jobs are expected to be created at two separate sites, one for engineering and the other for ready-to-fly assembly of the fuselage.

Aerolia set up subsidiary Aerolia Canada last year and launched a design office in Montreal. It spent about a year making a decision on where to establish its fuselage facility.

The Toronto region was a contender -- Bombardier's Global Express jets are assembled there -- but in the end Quebec beat out Ontario, said Mr. Le Gregam.

Quebec's Economic Development Minister Sam Hamad lauded Aerolia's decision to go with his province over Ontario.

"This is a major strategic project for Quebec's aerospace industry," he said.

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Ontario Ministry of Economic Development and Innovation spokeswoman Brianna Ames said in an e-mail message: "Ontario remains committed to attracting investment, promoting the province's aerospace industry and improving the industry's competitiveness. However, we also have an important responsibility to ensure accountability with taxpayers' money."

Bombardier spokeswoman Danielle Boudreau said the company had no part in the process leading up to the decision.

"Obviously we're delighted our new aircraft programs are attracting major aerospace manufacturers to come and establish operations here in Canada," she said.

Gregory Thomas, federal director of the Canadian Taxpayers Federation, said the playing off of provinces, regions and countries against each other to extract big concessions has a long history in Canada and around the world.

"Ontario has a horrific record of extending corporate welfare that's almost as bad as Quebec. I'm sure it went to the limit of its abilities to extend advantages to get this company to locate there," he said.

"When it comes to defense and aerospace, it's [playing jurisdictions off each other] a worldwide phenomenon and I don't know how to unravel it."

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Quebec has by far the biggest aerospace cluster in Canada, with about 42,000 direct employees and almost $12-billion in annual sales.

Ontario is second with about 22,000 employees and annual sales in the $6.5-billion range.

Bombardier's 7000 and 8000 jets are longer range extensions of models in its existing family of Global business jets. They are slated to enter service in 2016 and 2017, respectively.

The Montreal-area assembly facility is the first in North America for Aerolia, which has design and production units in France, Tunisia and in several other countries.

Aerolia's corporate strategy is to diversify away from its current dependence on Airbus contracts.

Mr. Le Gregam said Aerolia hopes to use the Quebec facility as a platform for further growth in North America.

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