Manitoba

Winnipeg dealerships see spike in vehicle sales ahead of U.S. auto tariffs

A Winnipeg auto dealer and an industry expert both say there's been a surge in demand for vehicles ahead of U.S. President Donald Trump's Wednesday announcement that sweeping tariffs, including a 25 per cent levy on the Canadian automotive sector, are coming into effect.

Experts expect vehicle prices to increase following Trump's announcement of 25% tariff on auto sector

A row of vehicles outside of a dealership in Winnipeg.
U.S. President Donald Trump announced a 25 per cent tariff on 'all foreign-made' automobiles will come into effect as of midnight Thursday, which could have severe implications for the Canadian auto sector. (Randall McKenzie/CBC)

A Winnipeg auto dealer and an industry expert both say there's been a surge in demand for vehicles ahead of U.S. President Donald Trump's Wednesday announcement that sweeping tariffs, including a 25 per cent levy on the Canadian automotive sector, are coming into effect.

The downside for consumers is that the cost of vehicles — both used and new — is expected to rise following what Trump is calling "retaliatory" tariffs, which will come into effect Thursday at midnight.

The 25 per cent tariffs, which were first announced last week, will be applied to passenger vehicles and light trucks imported into the U.S., as well as key automobile parts, with processes to expand tariffs on additional parts if necessary, according to the White House.

Experts say the automotive industry's deeply interconnected supply chain, and possible counter-tariffs by Canada, could mean higher vehicle prices here in light of the U.S. tariffs.

Taylor Liebrecht, who had been kicking the tires on a new vehicle purchase for the past couple of months, said she wasn't thinking about tariffs when she put a deposit down on her new vehicle Monday.

But she was warned by the dealership that prices could rise at the beginning of April.

A woman smiles outside of an automotive dealership.
Taylor Liebrecht picked up her new vehicle in Winnipeg on Wednesday. She says she wasn't thinking about tariffs when she put a deposit down, but had been warned by the dealership that prices could start climbing this month. (Randall McKenzie/CBC)

"With Trump, you never know," she said as she picked up her new ride on Wednesday.

"So I wasn't sure if they would increase dramatically, or just a little bit or maybe not at all, but I didn't want to take the chance, so I decided to put my deposit down on [March] 31st and get the pricing they were offering me at the time."

Winnipeg's Crown Automotive Group has seen a swarm of customers purchase vehicles at its dealerships over the last seven to 10 days, vice-president Kabeir Dilawri told CBC.

Dilawri said that's pretty consistent with dealerships he's spoken with in Ontario and Atlantic Canada, with many reporting some of their best weeks in years for sales volume.

"We're anticipating that if [tariffs] do come in, parts will go up, all supply chains will be impacted," he said prior to Trump's announcement.

He likened what he's seen recently to the slowdown of the global supply chain that gripped the world in the wake of the COVID-19 pandemic, but not altogether the same.

"This has definitely been a bit different," Dilawri said, since the pandemic issue was a lack of supply, whereas right now, it's more about intense demand.

Buy sooner than later: dealer

Like the dealership staff Liebrecht dealt with, Crown Automotive employees were encouraging prospective buyers to jump on purchasing opportunities sooner rather than later.

"We're telling them, 'Hey, listen, there's a good chance that if you think about doing something in June, the price will be higher. How much? We don't know," Dilawri said.

"We're all controlled by what Trump is deciding and what external factors dictate."

A man in a suit stands inside a Honda dealership.
Kabeir Dilawri, vice-president of Winnipeg's Crown Automotive Group, says there's been a surge in demand for vehicles in recent days. (Randall McKenzie/CBC)

He hopes the tariffs are not long term.

"We're hoping, you know, it doesn't affect the auto industry as severely as a lot of people are predicting," Dilawri said.

The hot automotive market isn't a surprise to Baris Akyurek, vice-president of insights and intelligence with AutoTrader Canada, which works with dealerships across the country to connect buyers and sellers of new and used vehicles. 

He said data released Wednesday morning indicated that new car sales across the country saw a double-digit percentage increase in March on a year-over-year basis, and sales were the best Canada has seen since 2018. 

"New car prices are stable so far but … when [tariffs] go through, then that's going to have an impact on [consumers]," Akyurek said via Zoom.

A headshot of a man in a blue shirt standing in front of a brick wall.
Baris Akyurek, vice-president of insights and intelligence at AutoTrader, says anyone in the market for a used vehicle may want to make a purchase sooner than later. (AutoTrader)

The demand for used cars is also growing in Canada,  according to Akyurek, but he's unsure if the tariffs will affect used cars that are exported to the United States. 

That said, he's also urging anyone in the market for a used vehicle to lock in a purchase as soon as possible.

"If you're going to buy a used car in two months or next month or whenever … if you know that prices are going to go up, would you not want to buy it now?" Akyurek said.

"If these tariffs are long-term, obviously the impact's not going to be only on the automotive market, it's going to be on the overall economy."

WATCH | Winnipeg dealerships see surge in business ahead of auto sector tariffs:

Winnipeg auto dealers see spike in sales as vehicle tariffs loom

1 day ago
Duration 1:50
Auto dealerships in Winnipeg say they're seeing a spike in sales amid the ongoing trade war, with U.S. tariffs of 25 per cent on vehicles and some parts set to start on Thursday.

ABOUT THE AUTHOR

Nathan Liewicki is an online reporter at CBC Manitoba. He was previously nominated for a national RTDNA Award in digital sports reporting. He worked at several newspapers in sports, including the Brandon Sun, the Regina Leader-Post and the Edmonton Journal.

With files from Matt Humphrey