The need for speed and agility in 2024

Manufacturers received some positive news in the federal government’s 2023 Fall Economic Statement released in November. Many businesses have been concerned about competing with measures introduced with the U.S. Inflation Reduction Act (IRA). The government has responded with a timeline for the implementation of five investment tax credits (ITCs) to help manufacturers transition to clean economy manufacturing opportunities.

As positive as this move is, however, market watchers note that the timeline for the introduction of the ITCs—late 2024—isn’t soon enough. Canadian Manufacturers & Exporters (CME), for one, is encouraging the government to speed up implementation to make up some ground relative to the IRA, which has already bolstered the U.S. economy.

“Although this is a step in the right direction, as it provides a little more certainty for our manufacturers, we are still behind. The race to develop a clean economy is picking up speed, and we need a robust response. We encourage all parties to work with the Canadian government to implement these initiatives as quickly as possible,” said Dennis Darby, president/CEO of CME.

The Canadian Chamber of Commerce similarly encouraged speedier implementation.

“We are delighted to see that legislation will be introduced,” said Bryan N. Detchou, senior director of natural resources, environment, and sustainability at the Canadian Chamber of Commerce. “However, despite a head start, Canada now finds itself trailing behind the United States and other jurisdictions in incentivizing clean technology and energy initiatives. It is imperative that the government swiftly introduces and passes legislation for the remaining three ITC programs. This proactive approach is necessary to prevent Canada from further lagging in the global competition for capital and investments in pivotal decarbonization projects.”

Regardless of potential tax credits, Canadian fabricators know they have to keep moving the needle on tech investments if they hope to compete in an ever-more-automated manufacturing environment. Two articles in the January 2024 issue address this directly. William Neeve, president of Cycle Time Management, offers a reminder that lean thinking has to serve as a foundation and guidance for any such investment.

AMADA AMERICA COO Patrick Medlin explains how his company’s operations in the U.S. are following this lean model, and how he and the AMADA team approach similar customer investments.

2024 is likely to be a challenging year. No one expects extreme economic conditions, but navigating to keep steady is just as challenging when you still need to become more efficient. Here’s hoping a few pieces you read this month offer some useful support.

Happy New Year from the Canadian Fabricating & Welding team. We look forward to bringing you more industry insights every month to help you steer your business in the right direction.