A Sector in Crisis
The animation and visual effects industry in Quebec is facing one of its worst crises in years. In recent months, several renowned studios have closed, including ON Animation Studios and Cinesite, highlighting the sector's fragility and the difficulties it faces in the current landscape.
The Impact of Tax Reform
One of the key factors behind this crisis has been the modification of tax credits, which previously allowed Canadian studios to compete internationally.
- Reduced Tax Incentives: Previously, Quebec offered benefits that lowered production costs, attracting major Hollywood projects.
- Less Foreign Investment: Without these incentives, many production companies have sought more profitable options in other regions.
- Decrease in Work: The lack of benefits has led to a drastic reduction in the workload for local studios.
“The cuts to tax credits have changed the industry landscape, forcing studios to seek alternatives in other regions.”
The Crisis in Hollywood and Its Effect on Quebec
In addition to tax changes, the global animation and VFX industry has been affected by other factors:
- Writers' and Actors' Strikes (2023): Paralyzed multiple projects, affecting the demand for visual effects.
- Reduced Streaming Investments: Platforms like Netflix and Disney+ have decreased their budgets for new productions.
- International Competition: Studios in Asia and Eastern Europe have attracted productions due to lower production costs.
Studio Closures and Their Impact
Recent closures and operational reductions have affected major studios:
- Cinesite: Faces multi-million dollar losses and a debt of 134 million euros.
- ON Animation Studios: Closed after more than a decade in Montreal.
- Technicolor Group: In financial crisis, seeking alternatives to continue operating.
These closures not only affect the companies but have left hundreds of artists, animators, and technicians unemployed, drastically reducing opportunities in the sector.
What Future Awaits Quebec?
The future of the industry in Quebec is uncertain. Despite having highly skilled talent and a history of successful productions, the lack of tax incentives and declining investments could lead to a loss of competitiveness.
- If the government does not restore tax credits, more studios could close or relocate.
- Major production companies might prefer other regions with lower costs.
- The labor market for visual effects and animation in Quebec will continue to decline without new support measures.
Companies Affected by the Crisis
Several studios operating in Quebec have historically relied on tax incentives. Without them, their presence in the region could be at risk:
- Cinesite
- ON Animation Studios
- DNEG
- Framestore
- Technicolor
- Digital Dimension
- Rodeo FX
- Hybride
- MPC
- Mikros Animation
- L'Atelier Animation
- Reel FX
- Squeeze Studio