Canada’s automotive industry players are navigating a sourcing shake-up as they seek vehicles from locations other than the U.S.
The federal government recently pulled back on some counter-tariffs, though the counter-tariffs on the U.S.-built vehicles remain. DesRosiers Automotive Consultants said the Canadian dollar value import data for vehicles shows a “fascinating” picture of the implications these policies have on vehicle sourcing.
“In the early months of the year, the Canadian vehicle companies, anticipating potential tariffs to come, rushed vehicles into Canada in order to build up their in-country inventory,” said DAC in its update. “As such imports from the U.S. exploded, with March imports jumping to over double the dollar figure seen in January.”
When Canadian counter-tariffs were imposed in April, imports from the U.S. slipped dramatically and have since been declining. With U.S. supply throttled, OEMs and distributors have leaned on other sources to fill the gap. Mexico has been the standout, with June import values up 98.7 per cent from January.
Dealers have been relying on pre-tariff U.S. inventory to carry them through a difficult period, but that cushion is no longer the option it was. DAC said there is little evidence that the costs of these tariffs and changes in sourcing have been passed onto consumers. And the price of new vehicles has changed little with only a 3.9 per cent increase in August 2025 compared to the same period a year earlier.
“The path ahead in terms of auto tariffs remains unclear,” said Andrew King, Managing Partner at DAC, in a statement. “However, it seems unlikely that the market can wait much longer for a resolution and that logistics and prices will continue to shift to align with the current reality.”
