Even though U.S. President Donald Trump announced a 30-day pause in tariffs that were supposed to go into effect today, uncertainty still looms over the Canadian economy.
A continental trade war that economists on both sides of the border feared would drive up prices has temporarily halted.
As a result of Trump’s decision, Canada and the provinces also stopped their retaliatory actions, which included imposing taxes and prohibiting the sale of alcohol from the United States north of the border. The largest private sector union in the nation, Unifor, maintains that Trump’s tariff threat is still in place and will endanger jobs in Canada.
Trump signed an order on Saturday to slap a 25% general tax on Canadian and Mexican imports, while lowering the levy on Canadian energy to 10%.
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Truckers claim that industry unemployment would result from levies. Truckers warn their industry would suffer greatly as trade between the United States and Canada will be negatively impacted by the tariffs that U.S. President Donald Trump has threatened.
The largest trade shock north of the border in almost a century would be the implementation of a 25% general tax on Canadian imports to the United States, which is currently postponed for at least a month until early March.
Stephen Laskowski, president of the Canadian Trucking Alliance, says the consequences may be the last straw for many of the 5,000 transport companies in his group, which are already having trouble due to dwindling consumer demand.
“If these tariffs came in at those levels for a prolonged period, this could be the final nail in the coffin for many trucking fleets,” Lawskowsi told reporters. “It’s a grim picture.”
According to Joseph Khoueiry, whose company Fabreville Inc. operates five tractor-trailers between Toronto and Montreal, the projected drop in overall transborder traffic would encourage more drivers to enter the domestic trucking industry. As the number of truckers competing for shipping contracts increases, the prices they charge will decline, reducing the bottom line.
“They are going to compete with us. It will effect the rate and cut into our margins,” he told The Canadian Press.
Khoueiry noted that replacement parts for his fleet would most certainly experience price increases as a result of the 25% tax imposed on vehicle imports from the United States, which will be paid for with an even weaker Canadian dollar. As of Monday, the loonie was trading at approximately 68 cents US, its lowest level since 2003, with currency experts anticipating additional drops if markets believe tariffs will be in place indefinitely.
The trucking group has urged premiers to facilitate interprovincial trade.
Mike Millian, president of the Private Motor Truck Council of Canada, agreed that the tariffs would be terrible for the trucking business. He stays vigilant for future tariff threats and supported the CTA’s call to lower interprovincial trade barriers.
“The PMTC is pleased to see cooler heads prevail for the meantime with a 30-day reprieve while the administrations work together to ensure tariffs are not implemented at all,” Millian said in a statement provided to TruckNews.com.
“While we are not out of the woods yet, this is a positive first step. Lets hope this time is used to ensure we both honor our negotiated and signed trade agreements, and both work together to secure our mutually shared border. In the meantime, Canada should continue working towards removing internal trade barriers to ensure a stronger internally trade partnership for the betterment of our entire country”.