How U.S. Tariffs Are Disrupting Canadian Logistics: What Companies Can Do About It

Date: May 08, 2025

In 2025, the global logistics landscape is being reshaped once again—this time, by a resurgence in U.S. tariffs that are having a ripple effect across Canada’s transportation and logistics sectors.

Earlier this year, the United States implemented steep tariffs on imports of Canadian steel, aluminum, and automotive products. The response from Canada has been swift: on April 9, the federal government imposed 25% counter-tariffs on U.S.-made vehicles that are not CUSMA-compliant, as well as on non-Canadian and non-Mexican content in vehicles that otherwise meet the agreement's criteria (Canada.ca, 2025).

A Logistics Sector Under Pressure

The impact of this tariff escalation has been deeply felt across Canadian logistics and supply chain operations. From large players like Ford—who anticipate a $1.5 billion hit to 2025 earnings (Financial Times, 2025)—to trucking firms like Schneider National, who have scaled back growth expectations (FreightWaves, 2025), the message is clear: costs are rising, uncertainty is spreading, and old assumptions about North American trade are being challenged.

 Meanwhile, trade data from March 2025 shows that Canada's trade deficit shrank significantly, mostly due to a drop in imports—further proof that tariff policies are altering business behavior (Reuters, 2025).

How Canadian Companies Are Responding

This shift presents both a threat and an opportunity. Many Canadian SMEs (Small and Medium Enterprises) are responding by diversifying their export markets, lessening their reliance on the U.S., which historically has consumed over 75% of Canada's exports (Reuters, 2025).

Others are re-evaluating their supply chains entirely—shifting sourcing to local or CUSMA-compliant partners to avoid penalty costs and regulatory headaches.

The federal government is also stepping in to provide support. On April 15, Canada announced new relief measures to help affected businesses, including tariff remissions on critical products and components (Canada.ca, 2025).

What Can Logistics Companies Do Now?

To stay competitive and resilient, logistics companies operating in Canada should consider the following steps:

• Diversify Supply Routes: Explore alternatives beyond U.S.-centric corridors. Ports in British Columbia or Atlantic Canada may become more important.

• Collaborate Across Sectors: Use the current situation as a catalyst to strengthen collaboration with government bodies, shippers, and customers. Collective strategies can mitigate individual risks.

• Leverage Trade Policy Advisors: Engage trade experts to assess exposure to tariffs and suggest compliance strategies under CUSMA.

• Invest in Digitization: Streamlining customs processes, inventory tracking, and supply chain transparency can reduce overhead and delays associated with cross-border friction.

• Monitor Policy Closely: Given the volatility of trade politics—particularly during a U.S. election year—companies must stay agile and informed.

Strategic Staffing: A Hidden Efficiency Driver

One increasingly viable strategy for logistics firms is the use of specialized staffing solutions for commercial drivers and warehouse personnel. By outsourcing driver recruitment and workforce management to professional staffing agencies, companies can dramatically reduce hiring times, lower onboarding costs, and adapt more quickly to demand fluctuations caused by global trade shifts. In a climate where delivery timelines and driver shortages are critical challenges, flexible staffing becomes not just a cost-saving tool, but a competitive advantage in ensuring continuity and responsiveness across the supply chain.

A Moment of Strategic Recalibration

The tariff standoff may feel like déjà vu from the 2018 trade tensions, but the stakes are arguably higher now. As President Trump signals no intention of backing down (WSJ, 2025), Canadian firms must embrace innovation, adaptability, and a more global mindset.

 In the midst of this disruption, there is a unique opportunity to build stronger, more resilient supply chains—and, in turn, a stronger Canadian logistics identity that is less dependent on its southern neighbor.

References

Forbes. (2025, Feb 4). Tariffs Will Cause Pain for the Transportation Sector.

Reuters. (2025, May 6). Canada’s Trade Deficit Narrows More Than Expected.

Canada.ca. (2025, April 9 & April 15). List of Tariffed Vehicle Products and Support for Businesses Affected by U.S. Tariffs.

Financial Times. (2025). Ford Sees $1.5B Tariff Impact.

FreightWaves. (2025). Tariffs Trim Schneider National's 2025 Outlook.

Wall Street Journal. (2025, May 6). Trump Firm on Tariffs Against Canada.

UPS. (2025). Global Trade Impact of 2025 U.S. Tariffs.