Minister of Industry Mélanie Joly has promised to “double down” on providing government funding to an American defence company’s subsidiary in Canada.
The minister made the comment at a virtual press conference on Wednesday, a day after announcing up to $34 million in government funding for Pratt & Whitney Canada, a subsidiary of the U.S. defence giant RTX, formerly known as Raytheon Technologies.
At the press conference, David Reevely from The Logic asked Joly how the money for an American company’s subsidiary jibed with the government’s “elbows up” message.
“I don’t think people in the aerospace sector would think that Pratt & Whitney Canada is actually an American company,” Joly said. “It’s been in Quebec, Longueuil, for 95 years.”
“We’re working on even more investments by Pratt & Whitney. [...] So we will double down,” she added.
The funding comes from the government’s “Strategic Response Fund,” which was given $5 billion in funding to help businesses “adapt, diversify, and grow in response to tariffs, trade pressures, and other challenges.”
Pratt & Whitney says it will use the money for a $275 million project to enhance manufacturing operations at its aircraft engine manufacturing plant, where Joly said engines are built for F-35 fighter jets, Airbus aircraft and Bell Textron helicopters.
The Maple asked RTX why it needs government funding to complete this project but did not receive a response by deadline.
In its own press release, the federal government claimed the investment would strengthen Canada’s “sovereignty” and “aerospace sector.”
“In an increasingly dangerous and divided world, the Government of Canada is taking action to secure our economic and national sovereignty, while at the same time advancing its ten key sovereign capabilities, including aerospace, as identified in the Defence Industrial Strategy. This collaboration will strengthen Canada’s position as a global leader in the engine market and position the Canadian aerospace sector at the forefront of advanced manufacturing and innovation.”
Prime Minister Mark Carney’s government has faced questions about its funding of American defence companies since it unveiled its Defence Industrial Strategy in February. The strategy said the government wants to increase the number of defence contracts it awards to Canadian firms, but didn’t define that term.
Since the announcement of the Defence Industrial Strategy, Canada has said it will spend billions on missile systems from Lockheed Martin. National Defence Minister David McGuinty has also argued that Palantir Canada — a branch of the American billionaire-founded artificial intelligence company working with Israel — is a Canadian company.
Joly offered her own definition of a Canadian company on Wednesday: “How I see Canadian companies is […] first, those who are Canadian not only because, of course, they’re incorporated in Canada but also have headquarters in Canada, very strong operations in Canada, but also those who have a real manufacturing footprint and that are key to our supply chain.”
Pratt & Whitney Canada has a dedicated president and page on the RTX website. But it’s owned by RTX, which is the second-largest defence company in the world and is headquartered in Arlington, Virginia.
A May poll from Pollara Strategic Insights found that Canadians strongly prefer that defence capabilities be developed by Canadian companies — especially over American companies.
Eighty-two per cent said Canada should “defend itself without relying too heavily on other countries,” the poll found. U.S. companies, including those operating subsidiaries in Canada, were the least favoured.
The research was conducted for a Canadian defence industry group.
Critics have previously told The Maple that Canada’s defence industry primarily supplies components and systems to U.S. defence giants such as RTX and Lockheed Martin. Therefore, the Carney government’s plan to build up Canada’s defence sector will further entwine the economy with the U.S. economy.
“The push to basically have an all in on defence industrial strategy — so we’re going to build up industries through military spending — is going to tie Canada ever more tightly to the U.S.,” said Nikolas Barry-Shaw, a campaigner at the Council of Canadians.
“It’s being sold to us as this big investment in building up our sovereignty. But I think it’s quite the opposite.”
