Businesses brace for slowdown amid uncertainty of looming U.S. tariffs

André Grzela doesn't like to worry for no reason, but when U.S. President Donald Trump first announced potential tariffs on Canadian products in November, Grzela said he got "sucked into the vacuum of panic." 

"Initially it was like I was panicking, barely slept," Grzela said. "I wasn't alone in that. A lot of other business owners were going like, 'Oh my God.' You know, spiralling." 

These days, Grzela said he's panicking less and being more proactive about how possible tariffs will affect his hot tub business in Orléans. Right now, he said he's calling suppliers and seeing what he can do to get Canadian products. 

On Monday, Trump announced the U.S. will go forward next week with a 25 per cent tariff on most imports from Canada, though he later specified he was referring to reciprocal tariffs. 

In early February, Canada threatened to retaliate with 25 per cent tariffs of its own, issuing a list with $30 billion worth of American goods it plans to target, as well as a list worth $125 billion more that would follow. 

Stuck in the middle of this are Canadian businesses like Grzela's. 

"If there are tariffs and counter-tariffs, it's not going to be good," he said. "It's not going to be good for hot tubs, it's not going to be good for any other luxury or retail store because a lot of things are multiple parts that come from everywhere."

Steel businesses hit hard

Claude Laplante, chief executive officer of Ideal Roofing, said around 20 per cent of the Ottawa company's sales are to the U.S. He worries that a 50 per cent tariff on steel, added to a 25 per cent general goods tariff, could be disastrous.

"Any future growth I think will be stopped in the U.S. All the efforts that we made for the last 50 years will be I think down the drain," he said. 

Laplante said business has slowed as both his suppliers and customers wait to see if these tariffs will go through. 

"Everybody's very worried of what could happen and what will happen," he said. "We're just on a wait-and-see basis now." 

Bruce Thomas, president of Ron Eastern Construction Limited, said the tariffs are creating uncertainty throughout that industry. The company builds residential highrises, and Thomas said he and his suppliers are looking at alternatives for U.S.-made appliances and steel couplers.

"I am hearing through colleagues in the industry that some of their clients are pausing potentially moving forward with projects or analyzing their options right now," he said. "And I think that that in itself is making us all a little bit anxious."

Looking to Canadian suppliers

Also looking for more Canadian suppliers is Rodney Wilts, owner of Ottawa's Evolta Electric. He anticipates tariffs will cause a slowdown in the construction industry and raise costs all around. 

"It's going to be a challenge on a number of different fronts," he said. "For us, we'll double down our efforts certainly on procuring materials that come from Canada or from countries that aren't the U.S."

Wilts said he's bracing for tariffs by altering contract terms in case tariffs go through and costs increase. 

"It's been clear over the last month or so that they're likely coming, and we've been working to get ourselves ready," he said.