Tariffs Update: Canadian Auto Factories Are Scaling Back

Already, thanks to the tariffs situation, Canadian auto factories are scaling back in different ways as demand and the cost to import assembled vehicles into the US has skyrocketed. While some might say such an outcome is horrible, we think this is exactly what President Trump has been gunning to do.

Jeep idles Toledo plant, blaming parts problem.

Last week, General Motors announced it will be cutting out a shift at its truck plant in Oshawa, Ontario starting in the fall, affecting about 700 assembly workers. While the tariffs are a big part of this move, lower demand for new trucks was also cited as a reason by GM, reports The Detroit News.

Both Chevy Silverado 1500 and Silverado HD models are made in Oshawa. But to bring them into the US, GM will have to pay a 25 percent tariff on each one. From what GM said, the plan is to scale back production so the trucks made there are for the Canadian market only.

Stellantis is reacting to the situation with vehicles from Canada is a different way. It has idled production at the Windsor Assembly Plant, which is also located in Ontario, for this week. That means about 3,800 workers are temporarily laid off.

While that doesn’t sound so bad, keep in mind Windsor Assembly was shut down for two weeks in April while Stellantis brass were supposedly analyzing the imported vehicle tariff’s affect on the overall market.

However, we think there’s a possibility the idling of the factory also helps with slowing the flow of new vehicles as consumers aren’t buying as many as before. The new Dodge Charger Daytona, plus the Chrysler minivans are assembled in Windsor.

There are yet more car factories in Canada and we don’t know yet how they’re being affected by the tariffs. But something tells us this is reshaping the entire landscape of the industry, which we think was the whole point.

Image via Stellantis