As the Schneiders meat plant ended production in Kitchener on Thursday, political and business dignitaries celebrated the opening of a new state-of-the-art Héroux-Devtek landing gear plant in Cambridge.
It is an example of advanced manufacturing that is the future of industry in Waterloo Region. Highly sophisticated automation and pieces of computerized equipment are now being moved into the 108,000-square-foot facility in the business campus off of Boxwood Drive in Cambridge.
A skilled workforce will make complete landing gear systems for the Boeing Company's B-777 and B-777X jet airliners. The plant, now in pre-production phase, is expected to be fully operational in June.
It is part of a growing aerospace industry cluster in Waterloo Region and the second Héroux-Devtek plant in the region. The company will continue to operate a 100,000-square-foot plant on Highland Road West in Kitchener that makes medium-to large-size landing gear components.
Héroux-Devtek's $54.2 million investment in the new facility is being made with the help of a $7-million contribution from the Ontario government. It will enable the company to fulfil a long-term contract to deliver landing gear systems to a Boeing factory in Everett, Wash., starting in 2017.
The expanded production capacity will result in 40 new highly skilled jobs, bringing the total Héroux-Devtek workforce in Ontario to more than 250 people, most of them in Waterloo Region, said Gilles Labbé, chief executive of Montreal-based Héroux-Devtek.
Labbé also announced the new plant will be named in Honour of the late John Cybulski, a long time chair of the company's board of directors who was an important contributor to the emergence of the landing gear industry in Canada.
The expansion into a second plant in Waterloo Region is just the beginning of a new level of growth for the company, Labbé said. "This new facility will play a pivotal role in Héroux-Devtek's future."
The property in Cambridge has enough room to build a 100,000-square-foot addition if needed, and Labbé expressed hope that will happen with future contracts.
"The new capacity and our solid reputation will enable Héroux-Devtek to pursue other business opportunities and to supply complete landing gear systems in the global aerospace industry," Labbé said.
The facility strengthens the company's status as a maker of mid-to-large complex landing gear components, he added.
Between existing contracts and last year's acquisition of a U.K.-based company that makes landing gear and hydraulic systems and assemblies, Labbé said the company's sales are expected to grow to $500 million by the 2019 fiscal year.
He added that there are challenges, including competition from offshore companies and a shortage of qualified workers for the highly skilled jobs here. "For this reason, we must invest in automation, workforce training as well as research and development," Labbé said. The company puts about five per cent of its revenues into research and development, he added.
Labbé said Héroux-Devtek hires skilled machinists and people trained in computer controls and automation that can run several pieces of equipment at a time.
Kent Fisher, vice-president and general manager in charge of the supplier chain for Boeing, said this is "a period of unprecedented demand in commercial aerospace." He said airlines will need more than 36,000 planes over the next 20 years valued at $5.2 trillion.
Last year, Boeing delivered a record 723 airplanes to its customers, including 99 B-777 airliners. There is a current backlog of 550 of the B-777 and B-777X airplanes in the order pipeline, Fisher said.
"So I hope you like to be busy, because we will be very busy over the next several years," Fisher said.
He added that a B-777 contains about three million parts and that Boeing works with more than 500 suppliers around the world.
Fisher said Héroux-Devtek was chosen for this contract because of the quality of the team and the workforce here. A big advantage of a new facility like the one in Cambridge is that it can be set up to improve the production process and make the best use of the advanced manufacturing technology, he said.
"In today's highly competitive airplane market, we need to not only build better airplanes, we need to improve on how we build them," Fisher said.
Brad Duguid, Ontario's minister of economic development, employment and infrastructure, said the province made the $7-million investment because Ontario has to compete with other jurisdictions in maintaining the jobs and building out the aerospace sector.
A complementary cluster of aerospace companies has emerged along a corridor in Ontario and Quebec, Duguid said.