This creates direct commercial risks for UK firms that sell into, source from, or invest in North America. Tariffs can raise landed costs, compress margins and force changes to sourcing and pricing, particularly in integrated sectors such as automotive, metals and consumer goods. At the same time, companies able to offer substitute inputs, dual-market distribution, or trade-compliance expertise may gain share as buyers look for resilience rather than lowest cost alone.
Key Risk
British companies dependent on integrated US–Canadian supply chains face higher input costs and production disruption as tariffs affect automotive products, metals, lumber and other industrial inputs.
Strategic Opportunity
British firms able to re-source tariffed inputs, manufacture within their target market or help customers navigate product classification and tariff exposure may gain an advantage over less adaptable competitors.
What to Watch
- Whether the Trump administration formalises its threat to raise tariffs on Canadian cars and trucks to 50% from 1 January 2027.
- Whether Canada’s counter-tariffs on approximately C$28bn of US goods take effect as scheduled on 8 September 2026, or are amended following further negotiations.
- Manufacturing output and employment in Ontario and Quebec, which RBC identifies as the provinces most exposed to US sectoral tariffs.
- Effects on Ohio after 8 September: Statistics Canada data indicate that approximately C$3.2bn, or 12%, of the state’s exports will be covered by Canada’s counter-tariffs, with steel and washing machines particularly exposed.
Read more: How the US-Canada trade war is being felt on both sides of the border →
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