June 29, 2018 8:07 pm

B.C. restaurants feel the squeeze as Pepsi raises prices due to trade war tariffs

FILE - In this July 9, 2015, file photo, Pepsi bottles are on display at a supermarket in Haverhill, Mass.


With the trade war between Canada and the United States heating up, one B.C. business says restaurants are already feeling the squeeze.

Canada has announced $16.6 billion worth of retaliatory tariffs against the U.S. on dozens of products, in response to President Donald Trump’s tariffs on Canadian steel and aluminum.

READ MORE: Here’s the final list of Canadian retaliatory tariffs taking effect against Trump on July 1

President and co-owner of C-Lovers Fish and Chips Brad MacLeod says his company got a letter from PepsiCo Canada on Friday, warning that prices would rise as of June 30.

The tariffs go into effect July 1.

WATCH: Canadian counter-tariffs impact costs at Winnipeg bakery

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“PepsiCo Beverages Canada has thoroughly reviewed the implications of these proposed actions, and has concluded that we must pass through any cost increase in order to be able to continue to provide the highest quality products, unequaled service, world-class marketing and consistent consumer value,” reads the letter.

The letter says restaurants will get specifics on price increases in the coming days.

It adds that the company recognizes that “cost increases can be challenging,” and that the PepsiCo will reassess prices if “conditions subsequently change across the North American landscape.”

READ MORE: Boycotting U.S. products? Here’s how to buy Canadian during a trade war

MacLeod said it’s a lose-lose situation for people north of the border.

“I don’t think people realize how much this trade war that we got into with the U.S. is going to cost your average Canadian,” MacLeod said.

WATCH: Solution to tariffs on American goods is in the hands of the U.S.

Whether those price increases will be passed on to fish and chips-loving fans has yet to be seen.

MacLeod said his company is still debating whether to switch to alternate suppliers.

“We’re going to have to make decisions on products, if we can source them locally — Canadian products — or increase prices,” he said.

READ MORE: Canada preparing ‘detailed’ response to potential Trump auto tariffs: Freeland

“They’re no two ways about it.”

The Canadian tariffs add 25 per cent to steel products, and 10 per cent to other products. The full list can be found here.

The tariffs affect dozens of U.S. products ranging from staples to yogurt to sailboats.

WATCH: Trump defends tariffs policy, says ‘we’re not starting a trade war, but we’ll finish it’

On Friday, Foreign Affairs Minister Chrystia Freeland said the government had no plans to back down.

“Countless Canadians of many diverse political points of view agree with this approach,” Freeland said.

“We will maintain the firm resolve to do so.”

PepsiCo did not say which of its products were affected by the tariffs, however several items on the list exist in the company’s product inventory.

Those include aluminum cans, orange juice and “waters, including mineral waters and aerated waters, containing added sugar or other sweetening matter or flavoured.”

Pepsi subsidiary brands include Tropicana and Gatorade.

-With files form Amanda Connolly

© 2018 Global News, a division of Corus Entertainment Inc.

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