What NWT auto dealers make of the looming car tariffs

“Every day, there’s a new announcement or a new twist or a new detail coming out. It’s difficult to stay on top of it.”

If you’re struggling to figure out what tariffs are going to do to your life, employees of Northwest Territories auto dealers like Evan Stard feel exactly the same way.

On Thursday this week, the United States says, it will introduce 25-percent tariffs on vehicles and parts produced outside the US.

Higher prices are extremely likely as a consequence. (US President Donald Trump drew headlines on Sunday by saying he “couldn’t care less” if manufacturers raise prices in response.)

Beyond that, though, the precise ramifications of tariffs aren’t clear. Exactly what will those price changes look like? Will it be exactly the same story for parts? In the NWT, where most things are already slightly pricier but which has less direct US trade, will the broad effect of tariffs be felt more gently or more harshly than in the rest of Canada?

Stard, at Aurora Ford Yellowknife, is trying to understand what will happen both from the perspective of a customer and an employee. Tariffs could feasibly affect jobs across the Canadian auto industry if customer enthusiasm dips when price hikes kick in.

Stard points out the tariffs aren’t here yet and negotiations are ongoing. The Trump administration has already backed away from the precipice of tariffs more than once this year, though Trump has recently insisted there will be no last-minute changes this time.

“There’ll be negative effects if it did happen. Most people are predicting prices will increase to a certain degree. It’s hard to say how much that would be,” said Stard.

“With that said, the flip side of the coin would be that used car prices will most likely increase as well and maybe offset that increase a little bit.”

That’s good news if you have a used vehicle to trade in, but less good if you were starting without one and aiming for a used vehicle in the first place.

“It’s crazy to think cars could go any higher in price,” said Matthew Milbury, the general manager of Aurora Dodge, a Yellowknife dealer for Chrysler, Dodge, Jeep and Ram.

“After Covid and the rise in costs of everything, I honestly felt we would have a cool-down phase where dealers would increase their supply on the ground and the demand would decrease,” Milbury told Cabin Radio by email.

“From what I understand with tariffs, costs of production and business are going to rise to get these vehicles on our lots, which in turn will force the manufacturers to raise prices to offset their production costs.

“It is typical to hear a salesman say ‘now is the time,’ but … I would suggest getting in sooner than later and take advantage of what stock is currently on the ground.”

Milbury pointed out that tariffs will not affect the stock NWT dealers already have at their disposal, so you shouldn’t see the impact of higher prices on anything that’s sitting on the lot this week. He, like Stard, noted that he expects the price of used vehicles to go up.

“We have hopes that lower interest rates could offset this some,” Milbury wrote, “but leaning on the hopes interest rates come down – with all of the craziness in the world – isn’t something we can all bank on at this time.”

‘We can choose how we respond’

Hay River-based Lee Cawson, vice-president of Aurora Group dealers, said dealers all have the same problem: nobody really knows what’s going to happen, the manufacturers included.

The tariffs are designed to affect vehicles and parts imported into the US. Cawson said it’s not as easy as that.

“The difficulty is that even with ‘domestic’ manufacturers, there is always a percentage of the parts that originate from outside the US,” he said by email.

That is going to complicate sorting out what does and doesn’t get hit by tariffs. Up till now, components often crossed borders between the US, Canada and Mexico multiple times during the course of one vehicle being assembled. How will that be reflected in the new world of tariffs?

“We know there will be an impact, we just don’t know what the extent will be,” Cawson wrote.

“I think the most important message to get across to people is this: Hay River and the NWT have gone through significant challenges over the last five years,” he continued.

“There have been factors outside of our control that have had an impact on our daily lives. We have a strong and resilient community and we look at this as an opportunity to reinforce our strength.

“We can’t control what is happening with the tariffs and the uncertainty but we can choose how we respond.”

Yellowknife Motors, a separate dealer for Chevrolet, Buick and GMC, said it had no comment.

“I’m doing my best to stay as positive as possible about it,” said Stard at Aurora Ford on Friday.

“I hope that tariffs don’t fully go through. You have to play the cards that you’re dealt. I’m sure the Ford Motor Company on both sides of the border is working pretty hard night and day on this, to try to ease everyone through it and do their best to minimize the economic impact to employees and as well to our customers.”

EV rebates dry up

The tariff rollercoaster arrives just as incentive programs for electric vehicles disappear from the map in Canada and the NWT.

Federal rebates for electric vehicles ended at the start of the year, with the program behind that cash – usually up to $5,000 per purchase – declaring itself tapped out a few months ahead of schedule.

Whether that program will return any time soon is unclear and, in all likelihood, rests on the whim of the incoming government after April 28.

Ottawa is looking into reports that the program’s funds ran out early in part because some Canadian Tesla dealerships made “astonishingly” high claims about the number of EVs they recently sold.

In the Northwest Territories, a separate territorial program that offered a similar rebate has been closed since last fall and is not being renewed.

The GNWT is not budgeting any money for electric vehicle rebates this coming year – deleting the $153,000 it set aside last year.

In the legislature last month, Yellowknife North MLA Shauna Morgan said the GNWT had considered its EV rebate program to be “one of the most effective programs for reducing greenhouse gas emissions that we have.”

“If we’re not supporting people to change to electric vehicles,” she asked, “who do we expect is going to be using the charging corridor that we have spent a whole bunch of money on?”

Infrastructure minister Caroline Wawzonek responded: “While I can’t necessarily provide any additional public dollars in this budget to sway people if they don’t want to spend the additional money on an EV, what we can do is ensure that for those people who are making that choice, they actually can charge that vehicle.”

NWT auto dealers who spoke with Cabin Radio said they hadn’t seen much of a push toward electric vehicles yet, even with prior government rebates.

“It has not played much of a role for us here,” said Cawson.

“The EV market is still developing. Initially, the rebates were important to encourage people to look at and purchase EVs. As the market matures, there needs to be less reliance on government programs and the product needs to stand on its own.

“EVs have not been a big part of our sales but, as the infrastructure improves along with the product, I am sure we will see more sales in this area.”

“Anyone living in the NWT is going to have a really tough time during ownership with an EV in my opinion,” Milbury wrote.

“The loss of the rebate will only slow down that demand for our area.”