Since the tariffs were first mentioned by U.S. President Donald Trump last fall, there have been thousands of layoffs in the Canadian auto sector.Fred Lum/The Globe and Mail
The U.S. tariffs on imported vehicles will reduce Ontario auto production by more than 56,000 vehicles this year, with deeper cuts over the next few years that put some plants in jeopardy, a leading industry analyst says.
Joe McCabe, chief executive officer of Pennsylvania-based Auto Forecast Solutions, says there are questions about the future of assembly plants in Oshawa, Oakville and Ingersoll, in addition to expected production cuts in Alliston.
On April 3, the U.S. levied 25-per-cent tariffs on autos from Canada, Mexico and other countries. The tariffs are reduced according to the U.S. content of the vehicles. Canada has responded with similar tariffs, but created a rebate program based on the importing automaker’s domestic production.
Automotive exports to the U.S. plunge as tariffs hit Canada’s carmakers
Since the tariffs were first mentioned by U.S. President Donald Trump last fall, there have been thousands of layoffs in the Canadian auto sector, in addition to cancelled and delayed production runs of cars. Most of the 1.3 million vehicles made in Ontario in 2024 were exported to the U.S. As recently as 2000, Canadian auto production reached 2.9 million, according to DesRosiers Automotive Consultants.
The tariffs, Mr. McCabe recently told the Canada Automotive Summit in Vaughan, are hastening the plunge.
“I’m not trying to be doom and gloom,” he said to the conference full of Canadian auto industry players. “We have to put a reality on what is occurring right now.”
Exports of Canadian-assembled automobiles to the U.S. fell by 23 per cent in April, the first month of the U.S. tariffs.
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May’s numbers will be even worse, said Flavio Volpe, head of the Automotive Parts Manufacturers’ Association, which represents 230 of the Canadian companies that make and supply parts to automakers in Ontario, the U.S. and Mexico.
Mr. Volpe said it is urgent that Canada finds a way to get the U.S. to drop the tariffs, amid deepening layoffs and declining production.
“Six months more of tariffs is a very big problem,” Mr. Volpe said in an interview. “It’s a very big problem for American companies that are manufacturing cars in Canada and American companies that are supplying parts and raw materials in Canada. It’s already a big problem.”
Unifor, which represents more than 40,000 workers in Canada at automakers, parts suppliers and dealerships, says it is worried about the future of several plants in Ontario, including plants owned by Ford Motor Co. in Oakville and Stellantis NV in Brampton. Both are closed for retooling and most employees have been laid off.
The plants produced zero cars this year and are not included in Mr. McCabe’s estimated production declines.
Cars pass along the assembly line at the Stellantis plant in Brampton, Ont., in July, 2023.Chris Young/The Canadian Press
Work on the Brampton site paused in February and no restart date has been announced. Oakville’s revamp is progressing, with production of pickup trucks expected next year, Ford Canada chief executive officer Bev Goodman said at the recent conference.
Lana Payne, Unifor national president, said the tariffs have put Ontario auto assembly plants and parts suppliers on precarious footing.
“U.S. tariffs are creating worrying vehicle production forecasts for Canada and North America. Shift reductions announced for the fall at GM plants in Oshawa and Ingersoll reflect this trend,” Ms. Payne said. “Trump’s tariffs are also battering sales forecast for vehicles, which hurt the entire North American industry.”
Ontario is home to five automakers – three Detroit-based and two Japanese.
The automakers either declined to comment and provide forecasts or did not respond to e-mailed questions.
Mr. McCabe and his company specialize in predicting auto production in North America by surveying members of the supply chain and other sources about orders, planning and demand in an industry that requires about three years of lead time.
Joe McCabe of Auto Forecast Solutions has said there are questions about the future of vehicle assembly plants in Ontario.Fred Lum/The Globe and Mail
Here’s how Mr. McCabe sees tariffs reshaping production at Ontario’s auto plants in the next few years. (The outlooks for the plants could change if the automakers decide to add production or if the tariffs are dropped.)
In Oshawa, General Motors makes the regular and heavy-duty versions of the Chevrolet Silverado. GM recently boosted production of the regular version in Fort, Wayne, Ind., and announced the layoff of 700 workers in Oshawa. Mr. McCabe says the shift south will continue, predicting Oshawa will make just 50,000 of the heavier trucks by 2028.
Ontario auto plant outlook
Auto Forecast Solutions’ predictions for vehicle output, in thousands
Internal
combustion
engine
Standard
hybrid
Plug-in
electric
hybrid
Battery
electric
vehicle
Honda: Alliston 1 and 2
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Toyota: Cambridge and Woodstock
600
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Stellantis: Windsor and Brampton
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
GM: Oshawa and Ingersoll
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
Ford: Oakville
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
the globe and mail, Source: auto forecast solutions
Ontario auto plant outlook
Auto Forecast Solutions’ predictions for vehicle output, in thousands
Internal
combustion
engine
Standard
hybrid
Plug-in
electric
hybrid
Battery
electric
vehicle
Honda: Alliston 1 and 2
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Toyota: Cambridge and Woodstock
600
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Stellantis: Windsor and Brampton
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
GM: Oshawa and Ingersoll
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
Ford: Oakville
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
the globe and mail, Source: auto forecast solutions
Ontario auto plant outlook
Auto Forecast Solutions’ predictions for vehicle output, in thousands
Internal
combustion
engine
Standard
hybrid
Plug-in
electric
hybrid
Battery
electric
vehicle
Honda: Alliston 1 and 2
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Toyota: Cambridge and Woodstock
600
500
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
Stellantis: Windsor and Brampton
400
300
200
100
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
GM: Oshawa and Ingersoll
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
Ford: Oakville
200
150
100
50
0
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
the globe and mail, Source: auto forecast solutions
GM’s Ingersoll plant, which makes the poorly selling BrightDrop electric parcel van, recently paused output and laid off employees. GM says it is committed to the plant, which will reopen in the fall with a smaller work force. And there are reports of a partnership with Hyundai. Still, Mr. McCabe says this is the Ontario plant at the highest risk of permanent shutdown.
Honda’s Alliston plant is set to see sharp production reductions in 2028 should the plant lose the gas-powered Civic, Mr. McCabe says. Output is predicted to fall to fewer than 300,000 a year from more than 400,000 today amid a shift to hybrid and battery-powered Civics. “There’s still an opportunity for Canada to get that Civic build back. But, unfortunately, there’s nothing in the business plans that say they’re doing that yet,” he says.
Ford closed its Oakville plant in 2024 and planned to make EVs there before that market slowed. Ford says the factory is being retooled to make large pickup trucks by 2026, but Mr. McCabe and Unifor say the plant’s future is at risk, given the same trucks are at U.S. plants, and face tariffs when shipped south.
Stellantis’s Brampton plant remains closed and the retooling is on hold with no announced restart date to make the Jeep Compass. The Windsor factory, which makes minivans and muscle cars, will undergo periodic shutdowns and the postponement of a third production shift, resulting in large output cuts this year.
Toyota in Cambridge, already Ontario’s largest automaker by volume, is set to increase production to about 600,000 cars a year with the switch to the popular hybrid RAV4. The two plants are the main North American source of the RAV-4 and Lexus NX. “We have them humming along,” Mr. McCabe says.