Prime Minister Mark Carney and auto industry leaders spoke Wednesday about how to build up a “made-in-Canada” supply chain and make it more sustainable as the sector continues to face the impacts of U.S. tariffs.
The meeting came as the industry continues to be hit by a 25 per cent tariff from the U.S. on the sector itself, as well as a 50 per cent duty on steel and aluminum, materials used in the manufacturing of vehicles.
However, there are exceptions for components produced in the U.S.
The Prime Minister’s Office said in a readout that Carney spoke with representatives of the Canadian Vehicle Manufacturers’ Association, as well as Ford Canada, Stellantis Canada and GM Canada.
“Prime Minister Carney and the leaders discussed ongoing negotiations with the United States, and the work to pursue a deal by July 21, 2025,” the readout says. “They discussed the impacts on the sector and the need to build up a made-in-Canada supply chain as well as diversify our trading partners.”
The readout goes on to say Carney spoke about the federal measures put in place to assist auto workers and businesses amid the tariffs, as well as the federal government’s plan to adjust its countertariffs on the U.S. come July 21 – a target date set for a new trade and security deal.
Carney and the auto leaders also spoke about opportunities to make the industry more sustainable and competitive amid shifting trade relationships and market conditions.
Brian Kingston, president and CEO of the Canadian Vehicle Manufacturers’ Association, told reporters in brief comments while heading into the meeting that electric vehicle mandates under current targets, as well as a range of other policies, are “not sustainable.”
What is Canada's current EV mandate?
The federal government under former prime minister Justin Trudeau set a target of 100 per cent zero-emission sales of light duty vehicles by 2035.
Last month, Environment Minister Julie Dabrusin indicated the mandate won’t be changing, despite calls by auto makers and other industry leaders to end them.
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However, the government in January halted its Incentives for Zero-Emission Vehicles program, which offered up to $5,000 off the cost of a new EV. Dabrusin said Ottawa does plan to bring back consumer rebates for EVs, but doesn’t know what they’ll look like yet.
That lack of rebate, industry leaders say, makes Canada’s goal for EVs unrealistic.
The vehicles have represented only 8.7 per cent of all new vehicle sales in Canada in the first quarter of 2025 — a drop from 16.5 per cent in the fourth quarter of 2024, according to Statistics Canada data.
What's the impact of the tariffs so far?
U.S. President Donald Trump has claimed for months that the U.S. does not need any Canadian-made vehicles, and called on automakers to shift all production to the U.S.
Canada has imposed retaliatory duties on the U.S.
Trump and Carney are currently negotiating a trade deal with a July 21 target date.
It’s not known at this time how wide a scope a potential deal could cover.
The impact has been felt in Canada, with a report released in April by Ontario’s financial accountability officer stating the province — which houses a large part of Canada’s auto industry — could enter a “modest” recession due to the tariffs.
The report found the impact of those tariffs would slow Ontario’s growth in 2025 and could lead to a modest recession this year, while remaining slow in 2026, though growth would return to just over one per cent.
Rising unemployment numbers in April also indicated the impact tariffs were having on the economy.
Ontario saw the biggest loss in April, with 35,000 jobs lost, mostly in the manufacturing sector.
Global News reached out to various automakers and organizations that represent them, as well as Unifor, which represents autoworkers, to inquire how many jobs have been lost as a result of tariffs.
In statements to Global News, both Stellantis and General Motors said no job losses have occurred due to tariffs.
The Global Automakers of Canada, which represents Toyota and Honda, also said there have been no job losses at this time.
Ford, the Canadian Vehicle Manufacturers’ Association and Unifor did not respond by publication.
David Adams, president and CEO of Global Automakers, told Global News this has been in part due to both manufacturers making vehicles at full production, saying the two companies manufactured about 70 per cent of the vehicles made in Canada last year.
“I think the reality is that if consumers really want a product, they may well be prepared to pay a little bit more to secure that product as well,” Adams said.
Adams cautioned while no job losses have occurred, it’s still a concern among his members, saying if the situation between Canada and the U.S. remains “unsettled” and tariffs stay in place, it could become more challenging.
He also confirmed that Toyota and Honda had not been invited to the meeting with Carney, saying it was a meeting with CVMA members, namely the Detroit “Big Three” automakers, but was hopeful his members would get a meeting with Carney soon given the amount of production by both.
“Their (Toyota and Honda) commitment to Canada is deep, it’s long and it shouldn’t be taken for granted,” he said. “I think that unfortunately these types of actions where maybe only one portion of the vehicle producing sector is dealt with sends the signal that they are kind of being taken for granted a little bit.”
— with files from The Canadian Press
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