Quebec auto parts suppliers and dealerships worried as U.S. tariffs loom

Quebec car dealers and suppliers are preparing for higher vehicle prices due to potential U.S. tariffs.

Quebec car dealers and parts suppliers are bracing for potential tariffs that experts say will increase vehicle prices across the country.

First, completed vehicles heading to the U.S. will be tagged with 25 per cent tariffs and then some car parts will be added.

“Now if we have 25 per cent tariffs on those parts, that’s going to increase the cost of the vehicle no matter where it’s sold,” said automotive journalist Gabriel Gelinas.

• READ the latest on Trump’s tariffs

According to research by JD Power, a 25 per cent tariff would increase new vehicle prices in Canada by about $6,000, bringing the average cost of a new ride in 2025 from $49,000 to $55,000.

Tariffs on steel and aluminum could drive those prices even higher, and, unlike other products, the idea of boycotting American-made vehicles is complicated.

Many international companies have production lines in North America. Japan-made Honda, for example, has 12 plants in the U.S., and most American brands aren’t entirely produced in the States.

“There’s no such thing, really, in Canada as an American car,” said Le Guide de l’Auto’s Mathieu St-Pierre. “I mean, you can’t just read a label like your strawberries at the grocery store: product from the U.S., product from Mexico.”

“Certain labour costs are way cheaper in Mexico,” added Gelinas. “That’s where they make wiring harness those and things that are very labour intensive. Energy costs are very low in Canada, so things like aluminum parts, are easier to produce here.”

And while Ontario is Canada’s car manufacturing hub, many suppliers are from Quebec.

“There will be an impact,” said Quebec Economy Minister Christine Fréchette.

Car dealers are also concerned.

“They’re absolutely worried about like the overall state of the industry,” said Canadian Automobile Dealers Association spokesperson Charles Bernard. “If it if it slows down or faces a real contraction, retailers have a product that if it’s produced less at a higher cost, it won’t be good for them.”

Those looking to buy a new vehicle would be wise to hit up a dealer soon, according to St-Pierre.

“If you’re thinking about buying a car now, be used or new, do it very, very soon,” he said. “Because I think that probably within a few short months, things are going to change.”

He added that the news coming out of the White House changes by the hour, which makes it even trickier for companies as well as customers.