The coming $26 billion windfall for the Canadian Armed Forces. What to buy?

[Lennox970]

Hopefully there aren't some unintended consequences with the new national defense strategy to buy Canadian. The Pentagon mostly considers Canadian suppliers as domestic and allows them to compete with U.S. firms. They could respond with similar measures.

Good point, the US is unsurprisingly the largest export customer (two-thirds of exports, one-third of industry output - double check my maths)

The latest stats that I can find from Innovation, Science and Economic Development Canada: State of Canada's Defence Industry 2024. The Globe article lists the sectors that the government is singling out, so the doubling is not across the board.

Potentially, a good idea, but will have to see plenty of thought given to upstream elements, skills, private investment, infrastructure supply chains, etc., etc. Plus, many other national defence industries - potential competitors- are gearing up at the same time (e.g. EU). Ultimate success will require a generation of effort (and money) and, crucially, support across party lines that defence is a priority.

 

[Admiral Beez]

Hopefully there aren't some unintended consequences with the new national defense strategy to buy Canadian. The Pentagon mostly considers Canadian suppliers as domestic and allows them to compete with U.S. firms. They could respond with similar measures.

Here are the top defence firms in Canada.

Canadian Defence Companies in Canada

Explore the top Canadian defence companies ranked by CDR. Discover leading defence contractors and their role in supporting Canada’s military.

canadiandefencereview.com

Much of this is US sub subsidiary work, and might as well be considered US domestic.

 

[kEiThZ]

Ottawa plans to double defence exports, create 125,000 jobs in next decade

Federal government aims to boost Canada’s economy through increased defence spending

www.theglobeandmail.com

Increasing Canadian defence exports is well and good, provided we don’t count in our success metrics those of wholly-US owned subsidiaries operating in Canada, such as GDLS Canada and Lockheed-Martin Canada.

Company ownership is not in the strategy. Workshare and IP ownership are. So LMC building the CMS330 and selling it from Canada will be seen as Canadian.

 

[hw621]

Here are the top defence firms in Canada.

Canadian Defence Companies in Canada

Explore the top Canadian defence companies ranked by CDR. Discover leading defence contractors and their role in supporting Canada’s military.

canadiandefencereview.com

Much of this is US sub subsidiary work, and might as well be considered US domestic.

One of the reasons why Trump thinks they own us...

 

[Admiral Beez]

Company ownership is not in the strategy. Workshare and IP ownership are. So LMC building the CMS330 and selling it from Canada will be seen as Canadian.

With all profits going to the US. But yes, I can see your point. Such sales would be considered Canadian.

 

[kEiThZ]

With all profits going to the US. But yes, I can see your point. Such sales would be considered Canadian.

The government cares about jobs and spending in the economy. Not about where profits go.

 

[hw621]

The government cares about jobs and spending in the economy. Not about where profits go.

given these profits are properly taxed...

 

[Admiral Beez]

The government cares about jobs and spending in the economy. Not about where profits go.

Contracts with and exports from the likes of Lockheed-Martin Canada and GDLS Canada may lead to more jobs and investment in Canada, but that’s not what Canadians have in mind when Carney sells the idea of separation from the US defence establishment. Imagine if the government funded the promotion and export of our domestic carbonated beverage industry with the goal being a move away from US beverages, followed by the PM announcing a sizeable portion of Canadian taxpayer funds would go to Coca Cola Canada. More jobs and investment in Coke Canada would be welcomed, but it still contradicts the notion of separation from US interests and influence.

I’d prefer that Carney’s announcement include a statement that we’re going to ensure that we also (but not exclusively) invest in defence firms that are not subsidiaries of US firms.