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U.S.-Canada trade tariffs: Impact on the auto care industry

February 3, 2025

On February 1, 2025, President Trump announced a 25 per cent tariff on all Canadian imports, with a 10 per cent tariff on energy, effective tomorrow. These measures threaten jobs, increase consumer costs, and disrupt the integrated North American supply chain, particularly in the vehicle manufacturing sector. 

In response, Prime Minister Trudeau announced 25 per cent retaliatory tariffs on $155 billion in U.S. imports, starting Tuesday with $30 billion in goods, followed by another $125 billion in 21 days. A full list of affected items is available here, including key auto care industry concerns such as retreaded/used rubber tires and various hand tools (handheld, pneumatic, hydraulic, and self-powered tools, drills, screwdrivers, vices, clamps, etc.). 

Provinces are also reacting: 

  • Ontario, British Columbia, Nova Scotia, and Quebec ordered wholesalers to remove U.S. alcohol from shelves. 
  • Ontario banned American companies from provincial contracts. 
  • Nova Scotia pledged to limit U.S. access to procurement contracts and review existing agreements. 

The Prime Minister spoke with President Trump this morning and will be speaking with him again at 3:00 p.m. The situation continues to evolve and there remains the possibility of additional retaliatory measures to come. 

Negotiation outlook 

Finance Minister Hon. Dominic Leblanc told CTV News that his conversations with Trump’s nominee for commerce secretary, Howard Lutnick, and others suggest that Canada will not be able to avoid the tariffs on Tuesday, and the next window for negotiations will be in March. 

The Automotive Industries Association of Canada (AIA Canada) remains in close contact with officials at the departments of Finance and Innovation, Science and Economic Development (ISED) and is actively monitoring developments.  

We stand in support of the countless Canadian industries impacted by these tariffs and will keep our members informed of any new concerns for the auto care sector as they arise 

We encourage members to reach out and share how these tariffs may affect them, so we can provide the most relevant and timely information. 

For additional questions, please contact Emily Holtby, AIA Canada’s vice president of government relations at emily.holtby@aiacanada.com). 

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Automotive Industries Association of Canada

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Nepean, ON K2H 7V1
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