Update to Members on Canada’s Response to U.S. Tariffs

Thank you for your patience as the Government of Canada shares more information the status of our trade relationship with the United States. I am writing with the latest update following an announcement earlier today by Ministers Champagne, Joly, Hajdu and Soloman. 

The ministers announced Canada’s retaliatory tariffs on U.S. products entering the Canadian market, following the U.S. implementing its new Section 338 U.S. tariffs (at a rate of 50%) on $28 billion worth of Canadian goods. They also announced support for workers and businesses negatively impacted by this trade war.  

Canada’s Retaliatory Tariffs on U.S. Products 

Finance Minister Champagne confirmed that Canada will match the new U.S. tariffs “dollar for dollar, rate for rate” on $27.6 billion worth of imported products from the U.S. Effective 12:01 a.m. September 8 (on goods that begin transit to Canada after that time), Canada will impose counter-tariffs of 15%, 25%, and 50% on products the U.S. targeted under its Section 338 and Section 232 tariffs. Canada’s tariff rate is based on the tariff rate the U.S. has placed on Canadian goods entering the U.S. 

List of U.S. Products Affected by Tariffs (Imports to Canada) 

Directly automotive: 

• 25% on 8414.80.10 turbochargers and superchargers for motor vehicles; 

• 25% on 7320.10.00 leaf springs; 

• 50% on 7320.20.00 helical (coil) springs; 

• 50% on 7320.90.00 other springs; 

• 50% on 7315.20.00 skid (tire) chains; 

• 50% on 7315.11.00 roller chain; 

• 25% on 8544.49.00 insulated wire and cable under 1,000 V (wiring and harness inputs); 

• 25% on 8609.00.10 and 50% on 7326.90.10 reusable containers for shipping motor vehicle components; 

Shop equipment and tools (mechanical and collision members): 

• 25% on 8425.42.00 hydraulic jacks and vehicle hoists; 

• 25% on 8467.22/29/89 power tools with self-contained motors and pneumatic tools; 

• 25% on 8414.80.90 compressors; 

• 25% on 8203.40 and 8205.70 to 50% on 8205.59 cutters, punches, vices, clamps and other hand tools; 

• 50% on 3919.10.99 self-adhesive tape in narrow rolls (masking and refinish tape may fall here depending on classification) 

Parts manufacturers and distributors: 

• 50% on virtually all steel (7206 to 7326) and aluminum (7601 to 7616), including fasteners under 7318. This is the largest exposure by value for any member importing U.S. mill product or metal components. 

• 15% on 8207.20/30 dies and stamping tools, 8480.49/71/79 moulds, 8428.70 industrial robots. 

Canada’s Supports for Tariff-Affected Workers and Businesses 

In addition to previously-announced support, today the Government of Canada launched a $7.5 billion package “of new and enhanced measures,” including the following that may apply to members: 

• $1.5B through the Regional Tariff Response Initiative to help SMEs, including liquidity supports to manage the pressures related to tariffs. 

• $500M liquidity stream under the Business Development Bank of Canada’s Pivot to Grow Program to help with immediate cash-flow pressures.  

• Lowering the requirement to $1M to access the Business Development Bank of Canada’s tariff related programs. 

• $3.5B Rapid Response Supports for Workers and Employers affected by tariffs. 

We will continue to follow the developments and provide updates as more information becomes available.  

In the interim, the more information you can provide to us about how these tariffs will impact your business, that would be deeply appreciated. This directly informs our outreach with government officials, on your behalf.  

Thank you in advance and please do reach out if you have any questions. 

Emily Chung 
President & CEO 
Automotive Industries Association of Canada