Canada's auto sector is tightly linked with US carmakers. Donald Trump's latest move to slap a 25% tariff on auto parts imported from the US neighbor is leaving suppliers scrambling to adapt amid rising uncertainty.
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00:00The Ambassador Bridge doesn't just connect the U.S. and Canada.
00:04Rather, it links one automotive capital, Detroit, Michigan,
00:08to another, Windsor, Ontario.
00:10And their industries are tightly welded together.
00:13But Donald Trump's new 25 percent tariffs on imported cars
00:17and certain car parts are aimed at getting more production
00:20within the U.S. border, leaving Windsor
00:22and its more than 90 automotive companies
00:25and suppliers out in the cold.
00:28It feels like the death of somebody who's very close to us
00:30in the family, right?
00:31Because we are so intertwined.
00:33Jonathan Azapardi is the president of Laval Tools,
00:36which builds tools and equipment to make car parts.
00:39It's not yet completely clear how much auto suppliers
00:42and their suppliers, in turn,
00:43are going to feel the effects of the tariffs,
00:46as full details of the policy are still emerging.
00:48But pain is expected all along the supply chain.
00:52People will have to take drastic steps
00:54to be able to manage that
00:55because nobody can swallow a 25 percent tariff.
00:58Not my clients, not me.
01:00Nobody can.
01:01We may have to make decisions that we weren't prepared for
01:05and we will likely have to pivot
01:07into something that we aren't today, right?
01:09A U.S. entity, establishing the United States,
01:12trying to figure out some way to fulfill those obligations
01:16on both sides of the border
01:17because that's ultimately what President Trump wants.
01:20And as companies in Windsor consider their options,
01:24it's hard for them to ignore
01:25that even more tariffs could be on the horizon.
01:28There's the other 25 percent duty on most Canadian imports
01:32that the White House levied in March
01:34but delayed implementing.
01:36Bruce Lane makes car parts
01:38that cross the border back and forth several times
01:40for treatment and processing
01:42along many stages of manufacturing
01:44before eventually landing in finished cars.
01:48Our parts are on a large number of vehicles built.
01:53I call it, it used to be called the big three,
01:56General Motors, Chrysler, Ford,
01:58but now it's, I call it the group of seven
02:00because you've got Hyundai in there
02:01and Honda and Toyota and Nissan, those sent.
02:05And maybe on most all of them,
02:08we have one or two parts
02:10on the different vehicles that they make.
02:12But on-again, off-again tariff policies
02:14have made it difficult to plan its expenses
02:17and to understand which tariff applies to what,
02:19whom, when and where.
02:21I would say not everybody understands who bears what cost.
02:25He too is considering a pivot,
02:27not by moving to the U.S.
02:28but by concentrating on a new product line
02:31to sell domestically,
02:32modular steel frames for construction.
02:35He's hoping a bet on business
02:37kept within Canada's borders
02:39could eventually afford him some security long-term.
02:42I worry for my grandchildren's futures,
02:47my children's futures.
02:51I just worry that it's going to be a knock on the economy
02:54and there can be a lot of people affected by it.
02:56Everybody's going to be affected by it.
02:58And it's this question around the future
03:00that everyone has in Windsor
03:02as they look across the river
03:03to their American neighbor.
03:05It's about whether the economic ties will hold
03:07or whether tariffs will tear them apart.