Canadians preparing for significant counter-tariffs are facing price increases not only on American aluminum, toilet paper, and furniture but also on the semi-trailers transporting these goods within and into the country.
Ocean Trailer, the primary distributor of semi-trailers in Western Canada, is awaiting the delivery of 600 trailers worth $45 million from U.S. suppliers.
In a race against time, the company is striving to import as many trailers as possible before a 25% Canadian counter-tariff on trailers and various other products comes into effect on Tuesday.
Mack Keay, the Chief Operating Officer of Ocean Trailer, mentioned that the additional 25% cost surpasses their profit margin on a trailer, leaving them with no option but to pass on the hike to customers.
The Canadian government has announced retaliatory measures mirroring the value of $27.6 billion on U.S. goods, in response to the recent tariffs imposed by President Donald Trump’s administration.
Keay expressed the possibility of canceling some of the order, but trailers already in production in the U.S. will have to be absorbed or sold in the U.S. due to the tariff deadline.
Concerns in the Industry
Ocean Trailer is not the only entity affected.
The head of the Manitoba Trucking Association highlighted that a significant portion of the semi-trailers in Canada are sourced from the U.S.
Businesses are rushing to expedite shipments into Canada before the counter-tariffs take effect, given the heightened costs.
Various types of semi-trailers are used in Canada, with dry vans and refrigerated vans being the most common. Dry vans transport a range of items, while refrigerated vans cater to perishable goods requiring temperature control.
Challenges in the Manufacturing Sector
Canada has only two semi-trailer manufacturers, situated in Ontario and Quebec, with limited capacity to meet the sudden surge in demand post-tariffs.
The potential cost increase due to counter-tariffs is significant across trailer types, raising concerns within the industry.
Increased costs will likely be passed down the supply chain, impacting consumer goods prices.
If this lasts many weeks … there could be companies going bankrupt.– Aaron Dolyniuk, Manitoba Trucking Association
Market trends in semi-trailer sales are unpredictable, influenced by the fluctuating demand for shipping services.
Given the current scenario, rental services may see a surge as trucking companies postpone trailer purchases due to higher costs.
The Manitoba Trucking Association anticipates severe repercussions if the tariff conflict prolongs.
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