B.C. manufacturing cranks out hit-and-miss year

8 things that mattered in manufacturing

Ye Zhou, president of Dynamic Structures, the sister company of Dynamic Attractions, with a small section of a massive, multimillion-dollar amusement ride | Chung Chow, BIV files

Losing the thread
Vancouver fashion house Kit and Ace announced in February it had laid off 35 people, about 10% of its head office staff, after opening 61 stores over the previous 19 months. The upscale clothing manufacturer, the brainchild of Lululemon Athletica co-founder Chip Wilson, had announced late in 2015 it had let go its previous chief executive officer, Darrell Kopke.

Slow start
The manufacturing sector started off 2016 on a sour note, as year-end numbers for 2015 from Statistics Canada showed a decline in sales for the first time since 2009. In 2015 Canadian manufacturing sales fell 1.5% to $609.5 billion, ending five consecutive years of growth. Sales declined in nine of 21 industries, and, according to Statistics Canada’s Industrial Product Price Index, the average price of manufactured goods fell by 0.9% in 2015. Petroleum and coal products were mainly responsible for the overall decline as sales dropped 28.6% to $59.3 billion, reflecting a 22.3% drop in the average price of refined petroleum products from 2014 to 2015.

Stalled sales
As of May 1, manufacturing sales across Canada had declined for the third time in five months, down 1% to $49.9 billion. This was largely due to lower sales of motor vehicles and petroleum and coal products. Sales fell in 15 of 21 industries, according to Statistics Canada. Partially offsetting these numbers was a 4.6% increase in sales of aerospace products and parts. British Columbia manufacturing sales, however, rose 1.1% in May, the first increase for 2016, largely due to softwood lumber production (up 3.9%) and Vancouver housing construction.

Suiting up
Vancouver high-end clothing manufacturer Indochino reported an all-time sales record for May, surpassing its former best month (November 2015), which included the blockbuster sales day of Black Friday. The menswear company did not reveal exact sales volume but said that 2016 sales until the end of May were up 67% compared with the same five months in 2015. Part of that increase had come from the company’s strategy to open bricks-and-mortar stores. Its seventh store opened in August 2015 in Beverly Hills and its eighth store opened June 1 in Mississauga’s Square One.

Can-do attitude
West Coast Canning (WCC), a Vancouver-based mobile canning operation, reported quadrupling its profits since opening two years ago. Thanks to B.C.’s burgeoning local craft brewing industry, 41 breweries opened in B.C. between 2014 and 16. The sector was expected to number around 130 breweries by the end of this year. WCC has 28 regular clients including Strange Fellows, Steel & Oak and Moody Ales. The company has also begun canning in Alberta and as of last summer had two full-time mobile crews operating five days a week, plus another crew at its Burnaby warehouse sleeving cans.

Thrilling deal
Theme-park ride manufacturer Dynamic Attractions announced last summer it was partnering with the China-based technology company Altair Space Technologies to build and co-own a $600 million outer-space-themed amusement park. The park was set to be built in Hangzhou, the capital city of China’s Zhejiang province, and has a projected attendance of between three million and five million people per year. The company also announced that roughly half the value of the park’s six rides would be built in Vancouver.

Taking flight
Avcorp Industries Inc. (TSX:AVP) announced that orders from Boeing (Nasdaq:BA) bumped its order backlog from $390 million to $579 million. The contracts for the Delta-based aerospace parts manufacturer were for a variety of components for Boeing’s 737 MAX and 777X passenger jets. Avcorp employs 700 people, half of whom work in Delta.
Avcorp also secured a $500 million deal a few years ago to make components for the Lockheed Martin Corp. (NYSE:LMT) F-35 stealth fighter.

Awash in delays
Canada’s federal shipbuilding program hit another setback, as documents showed more delays in construction of the navy’s new supply ships and the Canadian Coast Guard polar icebreaker. The delays are expected to cost taxpayers millions as stopgap measures are put in place. Two supply ships – one being the polar icebreaker – are expected to cost $3.9 billion and are set to be built Vancouver by Seaspan Marine Corp.