What Canada’s Tariff Shift Means for Engineers

Today, Prime Minister Mark Carney announced that Canada will remove a series of counter-tariff measures on U.S. goods as part of the latest step toward a final trade and security deal. The move follows the Prime Minister’s conversation with U.S. President Donald Trump and comes after the previously self-imposed August 1 deadline passed without a framework agreement. 

The Canadian government indicated that, under the Canada-United States-Mexico Agreement (CUSMA) protections, Canada’s current average tariff rate on U.S. imports stands at 5.6%, notably below the ~16% average applied by the U.S. in its agreements with other partners. On this basis, Canada will lift all tariffs consistent with CUSMA, compliance effective September 1, 2025, while maintaining targeted tariffs on autos, steel, and aluminum to protect strategic domestic capacity.  

“We have now re-established free trade on the majority of our goods. Our focus is squarely on these strategic sectors and our future,” said Mark Carney, Prime Minister of Canada in a statement on CAN-U.S. trade. 

The federal government also signaled imminent consultations on national priorities in a shifting global trade landscape, alongside nation-building projects being developed with provincial premiers. An industrial strategy addressing sectors affected by the global tariff system is expected in early September. 

Why this Matters for Engineers 

Engineers are on the front lines turning trade policy into real-world outcomes through supply chains, project delivery, and domestic industrial capacity. Today’s announcement has either immediate or imminent implications for all three. 

1) Supply chains and project costs 

• Broader tariff removal may ease costs for a wide range of inputs (electronics, machinery, components), improving budget certainty for infrastructure, energy, manufacturing, and technology projects. 

• Customs friction could diminish for many goods, helping projects stay on track to meet predicted timelines. 

2) Strategic sectors remain protected 

• Auto, steel, and aluminum tariffs will stay in place, signaling a policy priority to anchor domestic jobs, support research and development, and advance manufacturing. OSPE anticipates we’ll see parallel programs in procurement, innovation funding, and workforce development tied to these sectors. 

3) Procurement and “Made-in-Canada” potential 

• The government referenced new procurement programs to support steel workers. If designed well, these can: 
  • Incentivize high-quality, low-carbon materials and performance-based outcomes. 
  • Reward lifecycle value over lowest bid offers, an essential shift for safety, resilience, and long-term asset performance. 
  • Strengthen domestic production where it aligns with trade obligations and project value. 

4) Liquidity and industrial strategy 

• With business liquidity measures already in place and an industrial strategy coming, firms should watch for: 
  • Access-to-capital tools to bridge cashflow during supply chain resets. 
  • Skills and re-skilling investments in mechatronics, artificial intelligence, automation, welding, advanced fabrication, and project controls. 
    • Export readiness supports for scalable Ontario engineering firms. 

OSPE’s Call to Government 

To convert this policy shift into engineering value for Ontario, OSPE urges federal and provincial partners to: 

1. Adopt value-based procurement 
   Embed Qualifications-Based Selection (QBS) and total cost of ownership into public tenders. Reward safety, innovation, durability, and low-carbon performance, not just initial price. 

2. Tie incentives to domestic capability building 
   Where strategic tariffs remain, pair them with innovation challenges, apprenticeship pipelines, and research and development tax supports that grow advanced manufacturing and materials expertise in Ontario. 

3. Invest in resilient, low-carbon supply chains 
   Expand support for clean steel/aluminum, recycled content, and data transparency that lets engineers specify lower-emission inputs with confidence. 

4. Accelerate “nation-building” projects 
   Prioritize climate-resilient infrastructure, grid modernization, public transit, electric vehicle ecosystems, and water/wastewater upgrades. These are areas where Ontario engineers can deliver immediate productivity and emissions gains. 

5. Provide clear guidance and timelines 
   Publish a consultation calendar, sector-specific FAQs, and transitional rules so firms can plan bids, inventory, and workforce decisions with certainty. 

What Ontario Engineers and Firms Can Do Now 

• Map your exposure and opportunities: Review bills of materials and vendor lists to calculate the impacts of tariff removal compared to the impacts of the remaining strategic tariffs. 

• Update bid strategies: Revisit contingencies, lead times, and material substitution options. Flag where using Canadian or low-carbon materials can be a competitive advantage. 

• Engage in consultations: Bring evidence from projects (costs, delays, lifecycle analyses) to shape smarter procurement and industrial support. 

• Invest in people and tech: Prioritize training in advanced fabrication, automation, and project data tools to capture near-term demand. 

Engineers make trade policy real. With the right procurement, standards, and skills investments, this shift can strengthen Ontario’s industrial backbone, deliver better projects, and advance a resilient, low-carbon economy.