Canada is one of the most accessible markets in the world. Last year, U.S.-Canadian merchandise trade amounted to almost $600 billion—nearly 100 billion more than the United States’ next largest partner.(1)  And bilateral trade in services also was tremendous, at more than $76 billion in 2010, according to the most recent data.(2)

The automotive and aerospace industries account for nearly 30 percent of U.S.-Canadian merchandise trade.(3)And according to the U.S. Department of Commerce, “New developments in shipbuilding, air-defense, safety and security, mining, and renewable energy, will create virtually limitless business opportunities.”

Automotive and Aerospace Industries

Canadian consumers represent a major automotive market. In fact, in 2011, they purchased 1.59 million cars and light trucks, a number slightly up from the previous year.(4)

Canadian automotive imports from the United States totaled $21.4 billion last year. This represented 61 percent of total Canadian world automotive imports. Plus, Canadian imported another $7 billion in automotive aftermarket products from the United States and other countries.(5)As the Canadian market continues to expand, opportunities for American companies in the auto sector also will grow.

Bombardier, Pratt & Whitney Canada, Rolls Royce Canada, Bell Helicopter Textron Canada, and Boeing Canada are among several large original equipment manufacturers (OEMs) operating north of the U.S. border, and they significantly contribute to Canada’s status as the world’s fifth largest aerospace market. Interestingly, more than 80 percent of all Canadian aerospace production is exported worldwide, while 50 percent of industry imports are sourced from U.S.-based companies.(6)

According to the U.S. Department of Commerce, many opportunities exist for American exporters of civilian and military aircraft and parts, aircraft engines and parts, and avionics and instrumentation.(7)In addition, simulation software, air surveillance systems, air defense and combat technology are in demand.(8)

For more information, contact the Automotive Industries Association of Canada, the Automotive Parts Manufacturers’ Association, the Air Transport Association of Canada, and the Aerospace Industries Association of Canada.

Energy Industries

Canada is the United States’ largest and most secure energy supplier. In fact, in 2011, Canada supplied 29 percent of crude oil and petroleum imports in 2011—well above Saudi Arabia, the next largest supplier at 14 percent.(9)Overall, its 175.2 billion barrels of proven reserves of oil places Canada third globally, behind Saudi Arabia and Venezuela.(10)Canada also is the world’s third largest natural gas producer and exporter, and one of the world’s largest producers of hydroelectricity.(11)

On the other hand, Canada imported about $6.2 billion of oil and gas products last year. Plus, more than half of its oil and gas machinery is from the United States.(12) Additionally, Canada is a world leader in the production and use of renewable energy.

Moving forward, Canada is anticipated to provide many export opportunities for U.S. suppliers of energy equipment and services. This includes specialty mining and extraction equipment and services for the Canadian oil sands industry, as well as exploration and drilling services, refinery equipment, pipeline construction equipment, environmental remediation technology and services, and safety and security equipment and services.(13)

In addition, in support of Canada’s push for renewable energy, export opportunities exist in wind turbines, tower sections, rotor blades, casting and forgings, transformers, gears and generators, turbines, and related equipment.(14)

For more information, contact the Canadian Association of Oilwell Drilling Contractors, Canadian Producers of Petroleum Producers, Canadian Energy Pipeline Association, and the Canadian Renewable Energy Alliance.

Defense and Safety and Security Industries

At $23.7 billion, Canada is the sixth largest defense-spending economy within the NATO alliance and the world’s 13th largest overall defense spender in 2010.(15)In addition, over the next 30 years, Canada is anticipated to spend $34.3 billion to modernize the Canadian Navy and Coast Guard fleets.(16)

As a result, Canada represents considerable opportunities for U.S. exporters of weapon systems, hull and propulsion technology, naval communications and warfare sensors, and anti-terrorist technologies and services.(17)

Intellectual property pirates and identity thieves pose a significant and increasingly critical problem. In turn, Canada is attempting to enhance security systems to prevent unauthorized entry into sensitive computer networks and databases, as well as buildings and facilities.

Thus, the Canadian market for security products and services to protect commercial buildings was estimated at more than $2 billion in 2011. Plus, security related products totaled $1.14 billion last year for first-aid equipment, biometric security, reinforced safes, burglar and fire alarms, and physical-access security products.(18)Additionally, on-going Canadian airport security renovations offer other opportunities as well.

Last year, Canada imported more goods from the United States than from all 27 European Union countries. As the Canadian economy continues to grow, U.S.-Canadian trade is anticipated to provide an increasing array of opportunities to U.S. exporters.

For more information on defense and safety and security industries, contact the Canadian Association of Defense and Security Industries, Unmanned Systems Canada, the Canadian Department of Defense, and the Canadian Security Association.

Footnotes

1. U.S. Department of Commerce 2. Ibid 3. Ibid 4. Ibid 5. Ibid 6. Ibid 7. Ibid 8. Ibid 9. U.S. Energy Information Administration 10. Ibid 11. Ibid 12. U.S. Department of Commerce 13. Ibid 14. Ibid 15. Ibid 16. Ibid 17. Ibid 18. Ibid

This article appeared in International Insights, a Fifth Third Bank publication, September 2012.
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John Manzella
About The Author John Manzella [Full Bio]
John Manzella is a world-recognized author and speaker on global business, competitive strategies and the latest economic trends. He also is CEO of World Trade Center BN, chair of the Upstate New York District Export Council, and founder of The Manzella Report and Manzella Trade Communications Inc. His latest book is Global America: Understanding Global and Economic Trends and How To Ensure Competitiveness.




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