Canada’s federal government in Ottawa is allocating $1.4 billion for the domestic production of munitions in Ontario and Quebec.
Government officials say the aim is to build the domestic supply of heavy artillery shells and reduce Canada's reliance on foreign suppliers.
The munitions will be manufactured at new facilities in Ingersoll, Ontario and Repentigny, Quebec.
The companies chosen to make the heavy artillery shells are General Dynamics (GD) and Tactical Systems Canada. General Dynamics will handle most of the manufacturing.
The goal is to ramp-up production of 155-millimetre artillery shells and to start production of nitrocellulose, a compound used as a propellant in artillery shells, says Canada’s government.
Defence Minister David McGuinty said at a news conference that the $1.4 billion in funding for munitions is “essential to national security.”
The defense industry has been lobbying Ottawa to restock the military's ammunition stores given the rising threats to Canada’s sovereignty and geopolitical instability.
General Dynamics’ stock has risen 32% over the last 12 months to trade at $353.36 U.S. per share.
