Since its inception in 2008, the Canadian government funding program Automotive Innovation Fund (AIF) has awarded over $468 million in support. This funding fuels automotive R&D projects aimed at improving fuel-efficiency and lowering the environmental impact of automobiles. Canadian businesses awarded with funding include Toyota, Ford, Linamar, and Magna International.
The program was renewed in 2016 and additional funds were added for projects taking place until 2021. This article will help determine whether your project and company are eligible for this large-scale research and development funding program.
Suitable Projects for AIF Research and Development Funding
Projects should be valued at more than $75 million over five years and must be aligned with the Automotive Innovation Fund’s program objectives:
- Develop automotive research and development capacity in Canada as well as creating technical high-skill jobs;
- Improve the Canadian government’s science and technology (S&T) and environmental agendas;
- Aid the creation and/or incorporation of innovative, fuel-efficient processes and technologies;
- Encourage sustainable economic benefits to Canada, including large-scale job creation/retention; and
- Facilitate further private sector investments to secure Canada’s competitiveness in the global marketplace.
Company Eligibility: Automotive Innovation Fund
Based on past funding recipients, AIF tends to support larger automotive firms (ie. Tier 1), however the program encourages incorporated Canadian businesses to apply if they are carrying out projects with private sector investments in Canada valued at more than $75 million over five years. The applicant must have expertise in automotive innovation and R&D initiatives, as well as the infrastructure, personnel, and project details aligned with the program objectives.
Applicants should also be able to provide a project work plan, budget, forecasts, sources of other project funding and cash, the names of officers responsible for the project, and other application requirements.
Eligible Expenses & Activities: Automotive Innovation Fund
Project activities and expenses must all be directly related to developing vehicle or powertrain assembly processes associated with significant automotive innovation and R&D projects. These activities can include:
- New product development;
- Innovative engineering and design, including prototyping;
- Advanced product testing related to clean, green, fuel-efficient automotive performance;
- Development of new production methods and processes;
- New or expanded production facilities for energy efficient vehicles and powertrains;
- Meaningful investments in new flexible manufacturing processes; and
- Production technologies that significantly improve productivity and efficiency.
Eligible costs will be covered by Canadian government grants up to 10-15% and must be non-recurring expenses directly related to the project, including:
- Labour;
- Materials;
- Overhead;
- Specialized equipment;
- Building construction;
- Infrastructure;
- Purchase of land; and
- Other costs directly attributable to the project.
Applying for the Automotive Innovation Fund
Applicants will apply in accordance with a two-phase process. First, eligible recipients will need to provide industrial research, pre-competitive development documentation, and how the technology will be adapted or adopted to meet the objectives of AIF. The second phase will involve a detailed business case, which will be evaluated based on innovation benefits, environmental benefits, and economics benefits of the project. Applicants will also be evaluated based on the company’s capability to achieve their stated objectives.
Please note that research and development funding for small business is also available, such as research grants through the Automotive Supplier Innovation Program (ASIP). This program will be more suitable for small businesses that are committed to internal R&D of innovative automotive technologies and processes.
Continue Learning About the Automotive Innovation Fund
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- How Electric Vehicles are Gaining Worldwide Popularity
- Automotive Innovation Fund (AIF) Shift from Repayable Funding to Government Grants
- Automotive Technology Encourages Alert Driving Through Smarter Seats
- Automotive Industry on Pace to Secure Over $1.5 Billion in Investments