Irving Shipbuilding Pushes Canadian Content
Canadian shipbuilder Irving Shipbuilding Inc stated that it is committed to maximizing Canadian content and benefit through its construction of the Royal Canadian Navy’s Arctic and Offshore Patrol Ships (AOPS).
"Our AOPS contract requires us to achieve at least 50% of Canadian Content Value (CCV) in direct work, recognizing that in some instances, we must procure material for the ships internationally," said the shipbuilding and repair company in Halifax, Canada in a press note.
Today, approximately 70% of the work on AOPS is direct Canadian content. This is work that a Canadian supplier does with us directly related to the AOPS program.
Any work performed outside of Canada is offset by making investments in Canada to ensure that 100% of the value of the AOPS contract is spent in Canada. These are called Indirect Industrial and Technological Benefits (Indirect ITB).
The diesel electric engines onboard each AOPS are a good example of how the Indirect ITB program works. Irving Shipbuilding selected General Electric (GE) to provide the engines for each AOPS.
There is no company in Canada that produces this type of ship engine; therefore, the engines had to be procured from outside the country. To offset this, GE adjusted its global supply chain to include Canadian companies and made investments in innovative research taking place within Canada. These investments are with Canadian organizations involved with oil and gas, regenerative cell technology, and jet aircraft engines.
Indirect ITB transactions create opportunities for all Canadian industries to benefit from defence procurement, help to grow our overall economy and make Canada more innovative.
In addition to the direct and indirect investments as a result of the AOPS program, Irving Shipbuilding committed to investing 0.5% of contract revenue toward creating a sustainable marine industry in Canada as part of the Value Proposition program.
As of March 31, 2019, Irving Shipbuilding has committed over $12.5 million in value proposition investments to support 11 initiatives across the country that will strengthen and grow the Canadian Marine Industry in the areas of workforce development, technology and commercialization.