Bottom dollar no fun for Canada
Parity with U.S. greenback spells trouble down the roadThe parity of the Canadian and U.S. dollar is expected to put a squeeze on U.S. shooting here, but not just yet, industry players said Monday.
U.S. location shooting in Canada continues to benefit from major studios stockpiling product ahead of a possible SAG strike next June.
But after that, the loss of Canada's long-standing exchange rate-based competitive advantage — the Canadian dollar actually topped its U.S. counterpart last Thursday — is expected to eventually reduce the flow of studio shoots north of the border.
Ken Ferguson, president of Toronto Film Studios, said that major studios are less cost-conscious these days as they stockpile films and TV shows ahead of contract talks with U.S.-based writers and actors.
The last time the Canadian and U.S. dollars were at parity was in November 1976. In the intervening years, Canada established itself as Hollywood North as it enticed L.A. producers here with financial incentives, including a cheap dollar and tax credits.
Now, dollar parity has redrawn the Canadian production landscape. Ferguson said the true impact of the juiced-up Canadian dollar won't reveal itself before next summer.
"As much as the studios say they're not stockpiling, the fact is they are, and there will be less interest in coming here after next June," Ferguson said.
Dollar parity is particularly unwelcome for Ferguson, who is building the $60 million FilmPort studio on Toronto's waterfront, which is slated for a March opening.
John Barrack, national executive vp and general counsel for independent producers group the Canadian Film and Television Production Assn., agrees that studio stockpiling is providing a windfall to the Canadian production sector.
But absent the need to stockpile product ahead of a possible labor stoppage, Barrack said the level of foreign production would likely be well down thanks to the exchange rate.
Meanwhile, Stephen Waddell, national executive director of performers union ACTRA, called on the federal government to consider upping the current tax credit for foreign producers to keep major studios working in Canada.
"It's time to do something to raise that (federal) tax credit," Waddell urged.
He said that ACTRA will summon the Canadian Film and Television Industry Council, an umbrella lobby group for the domestic film and TV industry, to pressure Ottawa to sweeten the pot for foreign producers.
"It's necessary for the government to help promote production in Canada. This is a globally competitive business, and the U.S. producers and the studios, when looking at where to shoot major productions, will look to cost advantages," he said.