Roughly half of domestic manufacturers say they can weather a trade war that lasts more than a year, according to a survey released Wednesday.
The poll by KPMG in Canada says 54% of manufacturers surveyed said they will be able to withstand a tariff war with the U.S. that lasts more than one year.
The result compared with 67% of businesses surveyed in all industry sectors.
The report says 86% of Canadian manufacturing leaders say it’s time for Canada to start relying less on the U.S.
Moreover, it finds that domestic manufacturers want interprovincial barriers removed quickly, with more than three-quarters (76%) saying the ability to expand their customer base within Canada is vital to their survival. They aren’t alone; 96% of Canadians want them scrapped to make it possible for consumers to buy Canadian and have more choice.
“Indeed, all but 5% could redirect a portion of sales to domestic customers,” says Alison Glober, a management consulting partner and KPMG in Canada’s national manufacturing sector leader.
“The industry proved during COVID that they can handle adversity and pivot. They will need the same resolve today and evaluate all options, including expanding into new global markets, evaluating if it makes sense to shift production to the U.S., undertaking a strategic review of operations, identifying cost reductions and finding ways to boost efficiency and productivity.”
The report was based on a survey of 602 Canadian business leaders between Feb. 13 and Feb. 28, including 154 CEOs in the manufacturing industry.