Fear and anxiety are raised in Windsor, Ontario, after the automaker Stellantis announced that it would temporarily close its assembly plant in the Canadian border city next week due to the prices of the car from US President Donald Trump.
Derek Gungle, which is one of the 4,500 people employed at the factory, says that the temporary break of operations was “in a way expected”.
However, he tells the BBC that he worries about what will happen.
It is a feeling that is taken up through Windsor, the heart of the Canada automotive sector and just a bridge far from the American state of Michigan. For decades, the two regions have worked together through the shared border of the United States-Canada to build some of the most popular cars in North America, such as the Ford F-150.
Those working in the Windsor automotive sector who spoke to the BBC on Thursday say they are worried about the coming days now that the United States has implemented a price of 25% on all vehicles “made abroad. For Canada, this price will be reduced by half for cars made with 50% of American or more manufacturing components.
“It’s absolutely terrifying,” said Christina, who works at the Ford factory in Windsor for 25 years. She says that she fears that her plant will also close as Stellantis.
She has four children – one of whom is at university. His youngest is 12 years old. “I would also like them to have a good life,” said Christina as well as well in her eyes.
Responding to this anxiety of the building among the Canadians, Prime Minister Mark Carney announced that Canada was going to retaliate with its own prices.
Like the United States, Canada will take a price of 25% on American manufacturing cars sold in Canada. Produced vehicles in accordance with the North American free trade agreement between Canada, the United States and Mexico will be faced with lower taxes, the price applying only to non-Canadian car components.
Unlike the United States, Canada will not apply its rates on automotive parts.
“The government will react by corresponding to the American approach,” the Prime Minister told journalists on Thursday.
The Canadian government will also work to exempt from car producers from these prices if they choose to maintain their production and investment in Canada, Carney said.
On the campaign track, federal leaders of the main parties of Canada proposed their own solutions.
The conservative chief Pierre Hairyre called for the abolition of the federal tax on New-Canada cars, which, according to him, would increase the demand for them, while the leader of the Democratic Party Jagmeet Singh proposed the idea of selling “victory obligations” to the Canadians to constitute the economy of Canada in the middle of the current trade dispute with the United States.
The car manufacturing sector in North America is highly integrated, a car crossing the borders of the United States-Canada-Mexico several times before being assembled and ready to be sold.
For example, some Ford F-150 have engines built in Canada with electronic parts made in Mexico, then are assembled in Michigan or Missouri.
Stellantis’ closure announcement affects workers on Thursday in the three countries. Not only did the company interrupted operations in its long-standing factory in Windsor (which was once the Chrysler factory) for two weeks, but it also interrupted production in its Toluca factory, Mexico, for a month and dismissed 900 workers in the United States.
For Canada, the price is high. The country sells almost all its cars produced – 93% – on the American market, amounting to around 1.6 million vehicles. The car parts it makes for vehicles assembled south of the border are also now subject to a price of 25% American.
The prices of cars that are increasing for consumers are a probable result, explains Mahmood Nanji, a former assistant minister of the Ontario Finance Ministry.
Even with a 12.5% lower price applied to Canadian manufacturing cars with American parts, Mr. Nanji predicts that he would add $ 8,000 (£ 6,110) to the price of a Silverado Chevrolet.
“The dealers will find it difficult to sell these vehicles, and therefore demand could slow down,” he said, adding that it would have significant impacts on both sides of the American-Canadian border.
The prices will also be an “administrative nightmare”, explains Mr. Nanji, while companies and border security managers are trying to determine how these prices will be applied in the automotive sector entangled from North America.
Windsor car workers, like Chad Lawton, say they hope that these samples are temporary and that Canada and the United States could negotiate an agreement “, so we do not find ourselves in a situation that will lead to mass layoffs.”
But Mr. Lawton says that he also believes that Canada must defend himself and that it “cannot simply concede and turn around and allow it to happen”.
