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Automotive Innovation Fund (AIF) Investment in Linamar Corporation's Green and Fuel Efficient Powertrain Projects
21 September 2009
The Government of Canada has committed up to $54.8 million to Linamar Corporation’s Green and Fuel Efficient Powertrain Projects, an initiative that will total up to $365 million by 2013. About the Investment
There are two main components of the Green and Fuel Efficient Powertrain Projects:
The federal contribution to the Green and Fuel Efficient Powertrain Projects is conditional on successful completion of due diligence, including third-party verification, and all other federal requirements under the terms and conditions of the Automotive Innovation Fund.
About the Development of Powertrain Components
Linamar will design and develop a number of advanced powertrain components related to energy efficient engines, transmissions and drivelines. Linamar will work in-house and with other automotive suppliers to develop and adapt innovative technologies that can be integrated into new powertrain components, and that will contribute to meeting market requirements for lighter, cleaner and more fuel-efficient engines and high-performance transmission and drivelines systems.
To remain competitive, automotive suppliers will need to increase their design and development capabilities and make significant investments in Research and Development (R&D) to deliver technologies that meet new fuel efficiency regulations, stricter safety and environmental regulations, and consumer demands for higher quality, performance and energy efficiency. The development of advanced powertrain components will help ensure that Linamar is at the forefront of green powertrain component technologies.
Linamar’s new Frank Hasenfratz Centre is equipped with a supplier park where automotive suppliers will be able to use the Centre and its equipment to demonstrate new product ideas or innovation. When those prove promising, Linamar will work with the supplier to further develop and commercialize these innovations.
About the Development of Advanced Powertrain Components and Production Systems
Linamar will develop advanced production technologies and integrate state-of-the-art production systems throughout its automotive manufacturing facilities in Canada. These development activities are expected to minimize the environmental impact of Linamar’s manufacturing facilities and significantly improve productivity across a wide range of manufacturing processes associated with the production of various powertrain components.
At its manufacturing facilities, Linamar will integrate and develop production technologies related to advanced flexible manufacturing, advanced automation and advanced tooling. In addition, Linamar will work with other automotive suppliers to develop and implement new or improved lean production processes and systems.
By working with other automotive suppliers on the development of new powertrain components and related production processes, Linamar will further encourage the development and integration of Canadian suppliers and create a capacity in Canada to develop and produce high value added automotive parts and systems that will support future investments by major vehicle assemblers.
About Frank Hasenfratz Centre of Excellence in Manufacturing
Linamar Corporation’s new Frank Hasenfratz Centre of Excellence in Manufacturing will concentrate on process and product innovation as well as people development. The Centre allows Linamar to focus on advanced tooling, fixture and gauging analysis and development, introduce an advanced automation development group, and conduct product testing and R&D. Linamar’s employee training will be enhanced with the addition of a machine tool innovation program, a supplier development centre, enhanced apprenticeship and technical skills training, as well as leadership development. The centre is part of a $1.1-billion commitment to invest in people development and innovation.
About the Automotive Innovation Fund
The Automotive Innovation Fund (AIF) was introduced in Budget 2008 and provides
$250 million over five years to automotive firms in support of strategic, large-scale research and development projects to build innovative, greener and more fuel-efficient vehicles.
Industry Canada will consider proposals for funding under the AIF that include private sector investment in Canada over five years for eligible projects associated with significant automotive innovation and research and development initiatives.
Individual proposals are evaluated based on the strength of the business case, with specific emphasis on innovation, research and development, environmental, and economic benefits.
Funding through the AIF is provided in the form of unconditionally repayable contributions. At the end of the payback period, funding recipients will have paid back the contribution in full. Each proposal for AIF support is subjected to a comprehensive due diligence process to assess the project’s feasibility and risk, as well as its ability to deliver the proposed innovation, environmental and economic benefits.
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