The statistics are sobering. About 10% of the manufacturing jobs in Canada have disappeared since the beginning of 2008. The reasons are numerous and well-worn: the high dollar, outsourcing, lagging competitiveness.
Companies that have survived have become leaner and stronger — some have restructured, some have targeted profitable niches, some have added a dash of style, and some have done all those things and more. Here, a look at six companies that stamp their products Made in Canada.
By John Daly (words) and Cindy Blazevic (photographs).
Revenue (2012): $1.8 billion.
Number of employees: 8,000.
Number of pilots CAE trains each year: 100,000.
For pilots who climb into one of CAE’s elaborate plane or helicopter flight simulators — basically, a windowless cockpit on stilts — the flight can be even more hair-raising than a real one. The view on the screen looks the same as it would through an actual window, and CAE’s software can simulate any type of weather condition — from clear blue sky to gale-force winds (the stilts are hydraulic legs; during a simulated storm, they will buck and yaw the cabin).
The company has developed software to mimic flight conditions for more than 130 types of civilian and military aircraft, including the new Boeing 787 Dreamliner and some models that aren’t yet in service, such as Boeing’s P-8A anti-submarine bomber. When several simulators are linked by computer, pilots can even engage in group missions.
CAE sells more than 30 units a year, all of them built in Montreal. About 90% of its revenue comes from abroad, though sales in Europe have been slow since 2008 due to government cutbacks. Depending on who wins the U.S. presidential election, the Pentagon may cut back, too. But demand is growing in the Middle East, Asia and South America, and CAE’s civil business is strong. Profits have climbed over the past three years, and the company raised its quarterly dividend by 25% in August.
Number of employees: 60.
Oldest Casavant organ still in service: Notre-Dame Basilica of Montreal (1892).
Cost of an organ: $150,000 to $3 million.
Each of the 4,972 pipes in the massive new organ now being tested in the John F. Kennedy Center in Washington was made by hand in the town of Saint-Hyacinthe, just east of Montreal. The organ took two years to build. “We start with ingots and we create everything,” says Jack Rochette, Casavant Frères’s artistic director. Depending on the tone required, the mix of tin and lead in the pipes may vary — 50-50 in some, 70-30 in others, and so on.
You might think that a company that has been handcrafting its product since 1879 would be immune to short-term ups and downs. But full-sized pipe organs for churches and concert halls are not an everyday necessity. About two-thirds of Casavant-Frères’s orders come from abroad, and when U.S. demand plunged in the early aughts, it adapted in ways many modern manufacturers do: by concentrating more on service of existing units and finding new markets in China, South Korea and elsewhere in Asia.
Sales have stabilized at about three to eight organs a year. The company also has to contend with a lot of competition. There are dozens of pipe organ makers around the world. Five of the six in Canada are based in Quebec, including Orgues Létourneau Ltée, right across the Yamaska River in Saint-Hyacinthe.
Rimowa North America
Number of employees: 130.
Number of suitcases manufactured per year: 145,000.
Price tag of the 22-inch Topas Titanium Multiwhee: $1,340 (U.S.).
Sometimes government and private efforts to create an industrial hub pay off. Dieter Morszeck, owner and CEO of the stylish German luggage manufacturer Rimowa, checked out several U.S. and Canadian cities in 2008 before choosing to build a factory to supply all of North America in Ontario’s so-called Technology Triangle. He was particularly impressed by the skilled workforce in the Kitchener-Waterloo-Cambridge area, and its Toyota and Research In Motion plants.
Rimowa was founded in Cologne, Germany, in 1898, and introduced the first lightweight aluminum suitcase in 1937 (the inspiration: the fuselage of the Junker Ju52 airplane). The cases are sold in more than 400 stores in Canada and the U.S., mainly in high-end luggage retailers and department stores such as Bloomingdale’s and Neiman Marcus.
The Cambridge plant is the only one of the company’s four factories around the world that produces both aluminum and polycarbonate cases. While the private company won’t release revenue figures, sales must be good: Next door to the original Cambridge plant, Rimowa has broken ground on a new 70,000-square-foot facility — double the size of the first one.
New Flyer Industries
Revenue (2011): $926 million.
Number of employees: 2,216.
Number of buses built in 2011: 1,811.
Founded as Western Auto and Truck Body Works in 1930 by Ukrainian immigrant John Coval, the company’s first bus was essentially a cabin mounted on a truck frame.
The company has been innovating ever since. It introduced its first hybrid diesel-electric bus in 1998, and it’s now aiming to move beyond the internal combustion engine altogether — this past June, it unveiled an all-electric prototype.
In its 80-odd-year history, New Flyer (the name change came in 1986) has endured recessions, the oil crisis of the 1970s and global competition. The last six years, however, have been some of the toughest. After a bitter strike in 2006 and declining U.S. orders during the Great Recession, it adopted the Lean Six Sigma management discipline. Designed to do more with less and to engage employees directly to improve productivity, the strategy seems to have worked. Costly inventories are down, which frees up capital, and staff morale is up. U.S. orders have recovered, too, and include a recent contract to build 95 hybrid buses for Washington, D.C.’s public transit system.
Kudu Industries Inc.
Number of employees: 300.
Number of pumps sold per year: 5,500.
Barrels of oil a pump can extract per day: 1,258.
Of the 30-odd types of steel rotors Kudu produces — think oversized drill bits — most look like they’d be suitable for impaling the monster in the next Alien sequel. They are destined not for outer space, however, but the outer limits of oil exploration.
Each rotor will be encased in a stator — a 15-metre-long tube with a wave-shaped rubber lining — and lowered up to 3,000 metres below ground. Once there, the unit takes in oil, gas or water — and often sand or other debris — through holes near the bottom of the tube; then the whirling rotor propels the mix from one small pocket to the next through the lining. Finally, the oily concoction is sucked through piping to the surface by Kudu’s powerful pumps — or, to give them their proper name, progressing cavity pumps (PCPs).
Kudu chairman Robert Mills and his son Ray, the CEO, founded the company in the family garage in 1989, first selling French-made PCP units, then manufacturing their own. Kudu narrowly avoided bankruptcy in the late 1990s when crude prices dipped below $10 (U.S.) a barrel. It rebounded by adopting ISO 9001 standards to improve quality and efficiency and by seeking out new markets. The company now exports to more than 30 countries — two of the biggest customers these days are Kazakhstan and Oman.
Korhani of Canada, Inc.
Number of employees: 150.
Length of carpet produced annually if it were cut into one-metre squares and placed end-to-end: 2,351 CN Towers.
Price of its “Assunta” throw rug: $40.
Family-owned Korhani is only about one-100ths the size of the world’s largest carpet manufacturer, Georgia-based Shaw Industries, owned by Warren Buffett’s Berkshire Hathaway. But if carpet companies were ranked by chutzpah, Korhani would come in No. 1.
At the last three Toronto Fashion Weeks, it has — incongruously — clothed runway models in swatches of carpet (its carpet-cum-fashion has since appeared on runways in Berlin). The PR stunt was the brainchild of Kirsten Korhani, the company’s creative director (the Korhani family, originally from Iran, has been making and selling carpets since 1902).
In Korhani’s most recent designs, colours are bright, patterns are bold, and the overall effect is, well, out there. The wow factor seems to be working: Although exports make up less than half of the company’s revenue — in Canada, the carpets retail in Walmart, among other stores — sales to the United States and Europe are growing. The company has just one factory, in Sorel-Tracy south of Montreal, and since 2001 production is up fivefold — the facility now runs 24 hours a day.