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Study underlines Davie’s potential substantial economic impact

LÉVIS, QC – Davie, Canada’s premier shipbuilder, today revealed the results of a far-reaching study conducted by consulting and advisory firm, Deloitte LLP in Canada. The study, commissioned by Davie, examined the historical and potential major future economic and social impacts of its operations on Québec and Canada as a whole.

A virtual launch event, hosted by the Federation of Québec Chambers of Commerce (FCCQ), was attended by hundreds of business leaders. They were shown how spending and revenues associated with Davie’s activities ripple through and significantly impact the Québec and Canadian economies. Important structural and industrial benefits Davie brings to the Québec and Canadian economies were also in focus.

Davie’s contributions between 2012 and 2019 are examined in detail. From near bankruptcy in 2012 Davie, under Inocea Group ownership, has regained its position as the leading builder of cutting-edge ships for Canada and commercial customers. Since 2012, the study states, over $1 billion in private capital has been spent and invested to support Davie’s delivery of a roster of large, complex and pioneering ships.

The study estimates the potential value Davie is set to deliver into the 2040s, as a partner in Canada’s National Shipbuilding Strategy (NSS) and other key construction programs.  For example, while Davie contributed around $1.4 billion to Canada’s Gross Domestic Product (GDP) between 2012 and 2019, according to the study, over the next 20 years this could rise to over $9bn.

On jobs, over the past five years, Davie directly employed an average of 850 people per year, which is around 40% of all employment in Québec’s ship and boat building industry.

Between 2020 and 2040, Davie could annually create or sustain up to 4,300 full-time jobs.

Davie believes the study’s findings fully support the potential of the National Icebreaker Centre (NIC) as a key driver of long-term value creation. Building Canada’s much-needed Polar Icebreaker at Davie could generate 2,500 Canadian jobs annually during the period of construction and contribute up to $2.5bn to Canada’s GDP, if two icebreakers are built. Davie believes capture of this value could be greatly accelerated if it begins work on the Polar immediately, which would also directly impact Canada’s recovery from the COVID-induced recession.

Moreover, the construction of six heavy icebreakers under the NSS would, the study estimates, create major impact into the 2040s. This includes up to 2,790 jobs, $4.2bn in GDP and $1.1bn in taxes and other government revenues. 

The study also examines the structural and social impacts of Davie’s operations – aligned with the NSS Value Proposition framework. Moreover, the study shows that other long-term, structural benefits, include economic diversification, catalyzing third-party investment, cross-sectoral linkages and foreign direct investment (FDI) attraction.

Davie is driving the development of local supplier industries by creating demand for locally produced goods and services, according to the analysis. Between 2012 and 2019, Davie’s indirect economic contribution generated by supplier activities amounted to roughly $460m in GDP. Davie currently maintains a supplier base of over 1,300 firms across Canada.

The potential for Davie to drive the development in Québec of a successful maritime cluster is examined. A case study on Norway shows the power of strategic clusters supported by the public and private sectors focusing on innovative, high-technology products.

“It is with great pride that we joined Chantier Davie for the launch of its study by Deloitte on the economic impacts of shipbuilding for Quebec. The defense of Quebec’s economic interests goes through the protection of this key sector for which we must assert our know-how and our added value. We wish Chantier Davie every success in carrying out its projects as well as in the pursuit of its activities which are so essential to our economy! »Charles Milliard, President and CEO of the FCCQ