• Stellantis will pause Canadian production due to U.S. auto tariffs.
Industry experts and analysts predicted that U.S. tariffs on imported vehicles components would have devastating effects.
Two-week pause
We’ve now seen a first consequence on Day 1 of the imposition of those tariffs. Stellantis announced it will interrupt production at its assembly plant in Windsor, Ontario, starting next Monday, April 7. The company plans to resume production two weeks later, on April 21st.
The Windsor plant employs 4,200 workers and is where the Chrysler Grand Caravan and Chrysler Pacifica minivans are assembled, as are the gas-engine and all-electric variants of the Dodge Charger Daytona (electric and gasoline).
It’s worth noting that while vehicles imported into the U.S. are now subject to a 25-percent levy, vehicles from Canada and Mexico that comply with the trade rules of the CUSMA (Canada-United States-Mexico Agreement) will be subject to a 25-percent tariff only on their non-American content.
Here’s what Stellantis told Automotive News Canada:
“Immediate actions we must take include temporarily pausing production at some of our Canadian and Mexican assembly plants, which will have an impact to several of our U.S. powertrain and stamping facilities that support those operations. We will be temporarily pausing production at the Windsor Assembly Plant for two weeks (the weeks of April 7 and 14) with operations resuming the week of April 21.”
- Stellantis statement
Some experts, among them Linda Hasenfratz, CEO of Linamar, a Canadian automotive equipment supplier specializing in machining, have warned that the North American automotive industry could cease operating one or two weeks after tariffs come into effect.
More tariffs coming?
The auto industry can expect more pain to come as well. Some automotive parts will also be subject to 25-percent tariffs as well; we’ll know more about which ones at the beginning of May, according to the U.S. administration.
It’s safe to assume that discussions are continuing behind the scenes, but the U.S. seems set on going ahead with wide-ranging tariffs. If it does keep the just-implemented auto tariffs in place and even imposes more of them, an industry that has faced several major challenges in recent years will be confronted with its biggest one in decades.