According to a KPMG survey conducted in July 2026 among 275 Canadian manufacturers, 42% of respondents have either relocated some production to the US or are actively considering it, with 29% having already made the move. US tariffs on Canadian goods currently stand at 25% and are set to double to 50% on January 1, 2027, already triggering a 23% drop in Canadian auto exports to the US in April 2025. This situation has led 57% of Canadian manufacturers to pause, reduce, or cancel capital expenditure plans, while 42% have cut their research and development spending. Ottawa responded with dollar-for-dollar retaliatory measures effective September 8, 2026, in a context where companies are now prioritizing tariff-avoidance decisions over operational efficiency.
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