Aerospace Sector
Information Session
Seizing the Opportunity
January 2015
Presentation Overview
• Innovation – a Global perspective
• NSERC – the big picture
• Canada’s Aerospace Sector overview
• NSERC industry support
• Defining the opportunity
 A process through which economic or social
value is extracted from knowledge — through
the creation, diffusion, and transformation of
ideas — to produce new or improved
products, services, or processes.
-- Conference Board of Canada
HERD AS PERCENTAGE OF GDP, TOP OECD COUNTRIES (2009)
CANADA LEADS THE PACK…
5
BERD AS A PERCENTAGE OF GDP, TOP OECD COUNTRIES (2009)
CANADIAN BUSINESSES ARE LAGGARDS IN R&D EXPENDITURES!
6
SCIENCE AND INNOVATION PROFILE IN CANADA
Source: A comparative analysis of the sciences and innovation profiles
of ODEC and selected countries: December 2011
7
Federal S&T Structure
PARLIAMENT
Industry Canada
Prime
Minister
CABINET
Minister of Industry
Minister of State (S&T)
Science,
Technology and Innovation
Council
Research Funding
3 Granting Agencies:
Natural Sciences and Engineering
Research Council (NSERC),
Social Sciences & Humanities
Research Council (SSHRC), Canadian
Institutes for Health Research (CIHR)
Foundations: Canada Foundation
For Innovation (CFI), Genome Canada
Post-secondary research in
universities, colleges and
teaching hospitals
Research Funding
•National Research Council’s
Industrial Research Assistance
Program (IRAP)
•Canada Revenue Agency’s
Scientific Research and
Experimental Development
(SR&ED) tax credits
Industry
Research Performed in Labs
•National Research Council (NRC)
•Science-Based Department
and Agencies e.g., Environment
Canada, Natural Resources Canada
(NRCan), Health Canada
Federal Tri-Council Funding Agencies
Natural Sciences & Engineering
Social
Sciences &
Humanities
Health
SSHRC
NSERC
MRC
Canada’s Granting Councils
>20 years ago
NSERC
21st Century
Approach
CIHR
SSHRC
CFI
The NSERC Organization
Total national staff ~400
o Headquarters in Ottawa: ~379 staff
o Regional Offices: 5 offices, 4 staff each (*5 in Ontario)
NSERC-Ontario:
• Promotion
• Relationship Development
• Follow-up
Pacific
Prairies
Quebec
Ontario
Atlantic
In a nutshell … $1.1 Billion Budget
NSERC helps make Canada a country of discoverers and
innovators for the benefit of all Canadians 4.4%
Priorities
People:
Building our human capital in the natural
sciences and engineering
26.8%
31.5%
37.3%
Discovery:
Unleashing the creative power of our researchers
Innovation:
Connecting & applying the strength of our research
capacity to the challenges & needs of industry & society
People
Discovery
Innovation
Admin.
NSERC Support Spans the Research Continuum
Commercialization of
Research
MARKET READINESS
Business-Led
Networks
College and
Community Innovation
Program
Industry-Driven
programs
Strategic Partnerships
(Government Priorities)
Discovery Grants
research and training
TRAINING IN UNIVERSITIES
TRAINING IN INDUSTRY
RESEARCH & TECHNOLOGY MATURITY
16
The Canadian Aerospace industry
• Number of companies in the Canadian aerospace
industry: 700* companies of all sizes
• The Canadian aerospace industry contributed more
than $27B in direct and $42B in indirect revenues to
Canada’s economy in 2012, and employed 170,000
FTEs
• Canada’s aerospace manufacturing sector is ranked 5th
among OECD countries in terms of revenues and GDP
and 1st in terms of relative importance over total
manufacturing (2010).
* Firms where aerospace is their primary business activity
Aerospace: a strong export industry (80%)
Product Exports by Segment
Flight Simulator
4%
Other Parts
12%
Landing Gear
6%
Aircraft
39%
Avionics
11%
Engines
28%
54% of exports to USA – 24% Europe – 11% Asia
Canadian aerospace industry size of firms
Company Size
4%
11%
Small (1-99 FTEs)
Medium (100-499 FTEs)
85%
Large (500+ FTEs)
Over the last ten years: sizeable increase in number of medium-sized firms, slight decline in small ones
Tier structure of Canadian aerospace industry
Aerospace across the country
Manufacturing
MRO*
5%
8%
11%
Atlantic
27%
Quebec
46%
21%
Ontario
60%
Western
22%
NSERC +
NSERC * Maintenance, Repair and Overhaul
Aerospace: one of the most R&D intensive
sectors of the Canadian economy
R&D Intensity
Large firms responsible for
92% of R&D intensity
Total Industries
Total Manufacturing
Aerospace Manufacturing
0
2
4
6
8
10
12
14
R&D Intensity on GDP
16
18
20
NSERC RP Funding & Industry Contributions
$12,000,000
Aero 2002-12
Cash
$10,000,000
In-Kind
NSERC
$8,000,000
$6,000,000
$4,000,000
$2,000,000
$2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Aerospace Companies & NSERC
…Mostly manufacturing companies
Courtesy of CRIAQ
Defining the opportunity
• NSERC currently benefits from strong partnership with
CRIAQ  able to reach out to several companies in QC
• Strong participation from Ontario and Quebec
companies but…
• Partnership initiatives together with CARIC, OAC, OCE
provide new access for ON based companies
• Current context is favorable to increased collaborative
R&D
OCE Partnership – First Call
Ontario Aerospace R&TD Challenge
 OCE 1:1 cash + in-kind with 50% cash min.
 NSERC ROF + CRD
Enabling cross-sector
partnerships with industry
associations to address sectorwide research and development
challenges.
5 Major Research Partnerships (RP) Programs
Universities
Colleges
Strategic
Partnership Program
Industry-Driven
Collaborative
R&D Program
Commercialization
Program
Training in
Industry
Program
Colleges
Community
Innovation
Program (CCI)
Strategic Project Grants
(SPG)
Partnership
Workshops (PWP)
Idea to Innovation (I2I)
Industrial Undergrad
Student Awards
(i-USRA)
Applied Research and
Development (ARD)
Grants
Collaborative Health
Research Projects
(CHRP)
Interaction Grants
(IG)
Centres of Excellence
for Commercialization
& Research (CECR)
Industrial R&D
Internships (IRDI)
Applied Research Tools
and Instruments (ARTI)
Grants
Auto. Partnership
Canada (APC)
Engage Grants (EG)
Engage Plus Grants
(EPG)
Industrial
Postgraduate
Scholarships (IPS)
Innovation
Enhancement (IE)
Strategic Network
Grants (SNG)
Collaborative
Research and
Development (CRD)
Technology Access
Centres (TAC)
Network of Centres of
Excellence (NCE)
Industrial Research
Chairs (IRC)
College-University Idea
to Innovation (CU-I2I)
Business-Lead Network
of Centres of Excellence
(BL-NCE)
Industrial Research
Chairs for Colleges
(IRCC)
INNOVATION PORTFOLIO:
NSERC Research Partnerships Model
Industry
Future research knowledge
Academia
Ideas, advice, future employees
Project
NSERC
Partnership Budget
$335M
Connections to the academic
enterprise
PeerReview,
awards ($)
NSERC
Grants, scholarships, awards ($)
Key Evaluation Criteria
1. Applicant
2. Company
3. Project
Engage Grant
Engage Grant
(EG) (University)
• New relationship
• Up to $25k
• 6 months
• No company cash
• Company owns the IP
• No application deadline
• Fast 4-6 week turnaround
Engage Plus Grant
Engage Plus Grant
(EG) (University)
• Continue project and
relationship with Engage
• $12.5k company cash
+ $12.5k award
• 6 months
• Company owns the IP
• No application deadline
• Fast 4-6 week turnaround
Strengthening and Maintaining a Longer
Term Collaboration
Collaborative R&D
Grant (CRD)
“We are definitely ahead of the curve
today as a result of this collaborative
R&D project… significantly reduced our
material costs …placed us in a much
stronger position technologically“
John Persic, VP R&D, Microbonds
 Industry driven R&D project
 Shared costs: Each $1 cash
and $1 in-kind from
company levers up to $2
from NSERC
 Flexible
* Entire R&D spectrum
* Duration 1-5 years
* Small to large projects
* Apply at any time
 Success rate: 85%
Applied R&D (ARD) Grant
o Three levels of grants:
Applied R&D Grant
(ARD) (College)
1. Up to $25K (6 months)
o Requires new relationship,
industry partner contribution
o 4-6 week internal review target
2. Up to $75K / year, up to 3 years:
o Industry partner(s) contribute
1/3 of project costs
o External peer review
3. Over $75K / year, up to 3 years:
o Industry partner(s) contribute
½ of project costs
o External peer review
committee
Thank you!
Igniting New Research Partnerships
Through Engage Grants
• 445 new collaborations in first year, 88%
with SMEs
• 272 companies new to NSERC Partnerships
(>10% increase)
• 187 researchers new to Partnerships
Programs
• Decisions in 4-6 weeks