The Canadian Automobile Dealers Association says the auto sector tariffs implemented by the U.S. President is a concern.
National Spokesperson for the CADA, Huw Williams, says while the auto tariffs are worrisome, the fact that Canada was exempt from new tariffs was extremely important.
U.S. President Donald Trump did not include Canada in sweeping world-wide reciprocal tariffs announced Wednesday afternoon. However, previously announced tariffs on non-CUSMA compliant Canadian-made vehicles will come into effect starting today.
The White House declared that both Canada and Mexico would be exempt from the new tariffs that most other countries will face starting Thursday. A fact sheet from Trump's office says goods imported outside of the existing Canada-U-S-Mexico trade deal will see a 10 per cent tariff.
Williams says because of the trade agreement, there will be some relief in the auto sector.
"So because there's so much U.S. content in the vehicles that are being made in Canada, the tariff impact is going to be much less than the 25 per cent that the White House has highlighted. So I think you're going to see it's not an ideal situation, but it is a situation where the impact of these auto tariffs will be much less than we had thought.")
He says the Americans have recognized how heavy the impacts would have been.
"It would've been disastrous for their economy, disastrous for the American consumer, disastrous for American dealers, and now we have a rate that, while not ideal, is certainly livable and requires Canada to take a very long pause and not retaliate, but to figure out strategic ways to get the Americans to the negotiating table."
He says the announcement was mainly good news for workers.
"We've see what the reliance on CUSMA, or a trade-rule compliant automobile, that the threatened tariffs will be far, far less than impacted. We still have work to do with the American administration to have them understand that steel, aluminum, and auto tariffs aren't even necessary at all."
Williams says the CADA will be working hard on both sides of the border to explain how the tariffs will also impact the U.S.
He adds that there needs to be a new, stronger trade agreement with the United States to avoid these types of "hiccups" in the future.
Meanwhile, Prime Minister Mark Carney says Canada will fight tariffs with countermeasures after the country was excluded from new reciprocal tariffs.
Canada is still affected by some tariffs, including on auto, steel and aluminum exports to the U.S.