Canadians preparing for billions in counter-tariffs will not only witness increased costs for American aluminum, toilet paper, furniture, and other products, but also for the semi-trailers transporting these items into and across the nation.
Ocean Trailer, the leading semi-trailer retailer in Western Canada, is currently awaiting a $45-million order of 600 trailers from U.S. manufacturers.
The company is hurrying to import as many as possible before a 25 percent counter-tariff on trailers, along with numerous other products, goes into effect on Tuesday.
Mack Keay, Ocean Trailer’s chief operating officer, explained to CBC News from Vancouver, “The extra expense from the 25 percent tariff exceeds our profit margin on a trailer, meaning we would have to pass that cost onto the customer.”
The federal government has declared that dollar-for-dollar countermeasures will commence at 12:01 a.m. Tuesday on $27.6 billion in U.S. goods, as a reaction to the latest tariffs imposed by President Donald Trump’s administration.
Keay mentioned that Ocean Trailer might have the option to cancel part of its order, which was initially expected to arrive trailer by trailer until year-end, but the company is already committed to the trailers currently being manufactured in the U.S.
Trailers that are not brought into Canada by September 8 will need to be stored in the U.S. or sold to American retailers, and Keay indicated that he would not recoup the costs spent on them.
Industry ‘very much concerned’
Ocean Trailer is not the only company facing these challenges.
The head of the Manitoba Trucking Association stated that a significant portion of semi-trailers used in Canada are sourced from the U.S.
“I know several members who currently have trailers on order and are quite worried about the increased costs, as they placed their orders prior to the counter-tariffs,” remarked executive director Aaron Dolyniuk.
“I am uncertain whether they will be able to afford a 25 percent price increase when the trailers arrive.”
Dolyniuk noted that many enterprises relying on trucking services are also “hurrying to get goods across the border before the [counter-]tariffs take effect.”
“I was speaking with one member late last week … [who] mentioned that they typically transported two loads for one customer heading north, but they wanted 15 this week,” he added.
A variety of semi-trailer types are utilized on Canadian highways, with the two most prevalent being dry vans and refrigerated vans.
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Refrigerated vans, also referred to as “reefer” vans, transport perishables such as groceries and pharmaceuticals that require temperature control during transit to prevent spoilage.
Dry van trailers are utilized for a wide range of goods, including kitchen appliances, automotive parts, furniture, televisions, canned items, and other non-perishable products.
‘This is not going to be OK’
In Canada, there are only two manufacturers of semi-trailers—one located in Ontario that does not produce reefer vans, and another in Quebec that does manufacture reefer vans, alongside dry vans, flat freight vans, and various specialty trailers.
Neither manufacturer has the capacity to quickly meet the increased demand for trailer orders or rentals from Canadian trucking companies due to the counter-tariffs.
According to Keay from Ocean Trailer, the domestic production capabilities in Canada are less than half of what the trucking industry requires to satisfy demand.
The potential added costs from these counter-tariffs are staggering on an industry-wide level.
Keay stated that the average price across different trailer types is around $75,000, and a 25 percent tariff would elevate that figure to nearly $95,000.
Each of Ocean Trailer’s seven branches, from Manitoba to British Columbia, is receiving one or two trailers daily, either fulfilling orders from trucking companies or expanding the rental fleet, as informed by Dallas Senebald, the branch manager for the Winnipeg location.
“This is not going to be OK. It’s not just us; the entire industry will be affected,” remarked Senebald, whose Winnipeg office employs 40 individuals.
“There will be a trailer shortage, which will drive up demand and consequently increase trailer prices, affecting consumer goods that need to be transported.”
If this lasts many weeks … there could be companies going bankrupt.Aaron Dolyniuk, Manitoba Trucking Association
Senebald mentioned that the sales trends for semi-trailers can be erratic year by year, influenced by the supply and demand of goods needing transport.
One year, a significant corporate client might purchase 100 trailers, while the following year, they might not order any, according to Senebald. The Winnipeg branch may bring in 300 to 400 trailers one year, and only 80 the next.
This variability is one reason why the industry employs a mixed sourcing model. Ocean Trailer works with approximately eight suppliers, seven located in the U.S. and one in Mexico, stated Senebald.
As the largest retailer of semi-trailers west of Ontario, it also holds the top position in the rental market.
In the short run, Canadian trucking firms may resort to rentals while postponing purchases of U.S. trailers that are now 25 percent more expensive due to counter-tariffs, according to Senebald, which raises concerns.
“Demand for rentals is expected to surge to a point where we might not have enough to meet customer requirements,” he warned.
“Consistently saying no to customers is never a positive situation. Eventually, they will stop reaching out.”
Dolyniuk from the trucking association expressed that the extent of the impact will ultimately hinge on the duration of the tariff conflict.
“If this continues for several weeks … there could be companies in the trucking industry and beyond facing bankruptcy,” he cautioned.
