Minister Joly announces $55 million Federal Investment to advance sustainable Canadian dual-use aerospace technology at MDS Coating

SLEMON PARK, PE, May 13, 2026 /CNW/ - Today, the Honourable Mélanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions, announced a $55.7 million investment through the Strategic Response Fund in MDS Coating Technologies Corporation's (MDS) $212.9 million project to develop and commercialize its protective coating technology for aerospace engines. The  Government of Canada is investing strategically to strengthen Canada's dual–use industrial base and reinforcing aerospace as a key sovereign capability enabling the sector to build on its commercial strengths while supporting long–term industrial capacity.

MDS is a P.E.I.-based aerospace coating technology company specializing in the design, development and application of nanocoatings for aircraft engines. These investments will enable the company to expand its facility and to enhance its manufacturing capabilities for next-generation aerospace coating technologies. MDS's coating technologies are engineered to improve engine durability and retain engine performance, resulting in lower maintenance costs and reduced fuel consumption. This project will strengthen MDS's ability to meet the growing global demand for sustainable aviation products, while reinforcing Canada's position within the global aerospace engine supply chain.

The Government of Canada's investment in MDS will create and maintain up to 230 jobs, and in addition, the company will provide 70 student co-op opportunities over the course of the project. The government is delivering on its commitment to build a stronger Atlantic economy that is competitive in a net-zero economy. Today's historic announcement marks the largest-ever government investment in PEI's aerospace and dual-use sectors, and advances several Sovereign Capabilities prioritized in Canada's ambitious Defence Industrial Strategy. This partnership between the governments of Canada and Prince Edward Island is proof of how collaboration across governments and industry drives growth, resilience, and opportunity across the country.

The global economy is rapidly transforming, and the Government of Canada is focused on what it can control. Canada's defence industrial base is being strengthened to build a more sovereign and resilient economy – one rooted in Canadian workers and industries critical to our national security.

Quotes

"This investment in MDS Coating Technologies is a transformational milestone for Prince Edward Island's aerospace industry. By investing in sustainable innovation at home, our government is strengthening domestic supply chains, creating high-quality jobs for Islanders, and advancing Canada's economic and defence sovereignty through critical dual-use aerospace capabilities."
– The Honourable Melanie Joly, Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions

"With robust and domestic capabilities in advanced aerospace, Prince Edward Island is demonstrating not just the willingness but also the ability to contribute to our nation's industrial defence ambitions. Our continued partnership with MDS ensures the Island and Canada together can help develop the cutting-edge technology needed right here at home to help secure our future sovereignty."
– The Honourable Rob Lantz, Premier of Prince Edward Island

"The continued success of powerhouses like MDS Coating Technologies shows that our small province can be a strategic place for innovation and successfully export world-class proprietary clean technology, commercial aviation and defence solutions. Our investment today is a clear commitment to not only growing their facility and creating new jobs but also showing confidence in Island businesses as they seize global opportunities to grow and diversify."
– The Honourable Jenn Redmond, P.E.I. Minister of Economic Development, Trade and Artificial Intelligence

"P.E.I. has the people and the post-secondary institutions to train the highly skilled workforce MDS Coating Technologies needs today and well into the future. The expansion is a clear signal to students and existing professionals that a career in advanced manufacturing, aerospace, clean technology and defence are possible right here on the Island."
– The Honourable Zack Bell, P.E.I. Minister of Workforce and Advanced Learning

"This investment is a transformational milestone for MDS Coating and reflects the strong partnership between industry and multiple levels of government. For more than 25 years, our advanced coating technologies have helped improve the durability, efficiency and sustainability of turbine engines around the world--a testament to the dedication, innovation and commitment of the entire MDS team. This next phase will create a world-leading Coating Centre of Excellence, strengthen our global reach, expand our capabilities, create highly skilled jobs here on Prince Edward Island and position MDS for the next generation of aerospace innovation."
– Phil Rodger, CEO, MDS Coating Technologies Corporation

Quick facts

• The Strategic Response Fund (SRF) helps Canadian industries innovate, adapt and compete in a changing global economy. The SRF supports large-scale, transformative projects that build economic resilience, strengthen supply chains and protect good jobs in key sectors such as steel, aluminum, automotive, forest products, AI and advanced technologies.
• Founded in 1997, MDS is an aerospace coating technology company specializing in the design, development and application of thin film protective coatings (nanocoating) for compressor sections of gas turbine engines for planes.
• MDS has approximately 100 employees and is one of the largest manufacturing employers in P.E.I. It operates a Manufacturing Centre of Excellence in Slemon Park, P.E.I., and a research and development facility in Montréal, Quebec.

Associated links

• Strategic Response Fund
• MDS Coating Technologies Corporation
• State of Canada's Aerospace Industry
• Canada's Aviation Climate Action Plan
• Emissions Reduction Plan

Stay connected

Find more services and information on the Innovation, Science and Economic Development Canada website.

Follow Innovation, Science and Economic Development Canada on social media.
X (Twitter): @ISED_CA | Facebook: Canadian Innovation | Instagram: @cdninnovation | LinkedIn: Innovation, Science and Economic Development Canada

SOURCE Innovation, Science and Economic Development Canada

Contacts: Gabrielle Landry, Deputy Director, Media Relations, Office of the Minister of Industry and Minister responsible for Canada Economic Development for Quebec Regions, [email protected]; Media Relations, Innovation, Science and Economic Development Canada, [email protected]