Canadian Auto Industry Responds to Trump’s Tariffs, Sends Warnings
U.S. President Donald Trump has moved forward to enact threatened 25-percent tariffs on all goods imported from Canada (10 percent on energy) and Mexico.
Even though two-thirds (67 percent) of Canadian business leaders say they can weather a trade war that lasts more than a year, over eight in 10 (86 percent) continue to support retaliatory tariffs against the U.S., a new survey by KPMG has found. Hundreds of thousands of jobs across the country are at stake, after all.
- Also: All the Vehicles Built in Canada and Mexico That Are Sold in the U.S.
- Also: Ford CEO Says Trump Policy Uncertainty Creating "Chaos"
The auto industry will be one of the hardest-hit sectors, with a serious risk of permanent and significant damage.
“Tariffs are taxes that hurt consumers with increased costs, drive inflation and unfairly impact workers on both sides of the border. We need a long-term solution that removes these unjustified tariffs and ensures stability and competitiveness for all North American businesses,” said David Adams, president and CEO of Global Automakers of Canada, which represents the Canadian interests of 16 foreign automakers.
It’s pretty clear that there will be immediate negative consequences for the highly integrated North American automotive supply chain, according to Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, which advocates for General Motors, Ford and Stellantis.
“U.S. tariffs implemented today will do significant damage to the highly integrated North American automotive industry. This will undo over 60 years of integration that has fostered a globally competitive automotive industrial base,” he said. “Given the importance of the automotive industry to the U.S., Canada, and Mexico, the tariffs will have negative economic consequences. We are calling for an immediate lifting of the tariffs.”
Another who feels the same way is Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, who fears that the auto industry will “grind to a halt” within days or weeks, returning to “pandemic-level idling” in a dozen U.S. states as well as Ontario and Quebec.
🇨🇦automotive suppliers are heavily invested in the 🇺🇸USA. This is a major two-way relationship.
— Flavio Volpe, C.M. (@FlavioVolpe1) March 4, 2025
🇨🇦s have invested billions in 170+ facilities in 26 US States & 48k American employees.
Thanks to @jason_kirby & @globeandmail for sharing our research.https://t.co/iKONnemfso
In other separate posts on X, he wrote: “You can not hurt [Canadian] auto without hurting the U.S. immediately,” and then, “Nobody wins when you attack the very allies you depend on.” Volpe added that Canadians “are not pushovers.”
For Unifor president Lana Payne, who has thousands of members working at plants for Detroit’s Big Three, the imposition of tariffs on Canadian goods by President Trump is an economic call-to-arms for Canada.
“After months of taunts and threats that have already hurt investment decisions and jobs in Canada, Trump has fired the first shot in a full-on trade war and now every Canadian politician, business leader, worker and resident must fight back,” she said. “Trump has seriously misjudged the resolve and unity of Canadians, and he has misjudged how damaging this trade war will be for American workers.”
Just like Adams, Kingston and Volpe, Payne also predicted that “these tariffs will hurt working people with higher prices for everyday goods, destroy jobs on both sides of the border and have devastating consequences for highly integrated manufacturing sectors, including auto, across Canada and the U.S.” She believes it is vital to “invest in ourselves, redefine international trade relationships and build a new, more resilient economy.”
