Amid the ongoing trade tensions between Canada and the United States, a wide range of products, including electronics like cellphones, gaming consoles, and artificial intelligence infrastructure, are expected to see increased costs for consumers and businesses, according to experts.
Last year, Canada exported over $4 billion US worth of electronics equipment to the U.S., which will now be affected by President Donald Trump’s newly imposed 50 per cent tariffs on various goods. Notably, certain electrical boards and controllers constitute the highest export category facing these tariffs.
Following the U.S. administration’s tariff announcement, Prime Minister Mark Carney stated that Canada would reciprocate with equivalent tariffs.
Industry experts anticipate inevitable price hikes as the trade dispute intensifies, posing challenges for businesses on both sides of the border. Carol McGlogan, the president and CEO of Electro-Federation Canada, expressed concern over the detrimental impact of the 50 per cent tariffs, noting that a significant portion of her members’ exports go to the U.S.
McGlogan emphasized that the tariff increases would have far-reaching consequences, affecting the costs of various infrastructure projects such as homes, schools, and buildings. She highlighted the need to expand the electricity grid by 2050 and emphasized that the tariffs would escalate the overall expenses, burdening taxpayers.
Evan Light, an associate professor at the University of Toronto, pointed out that prices of items like gaming consoles and cellphones have been rising due to chip shortages and supply chain challenges. He warned that the escalating Canada-U.S. trade conflict would further drive up prices of these products.
Andrew Bell, the chief product officer at Ottawa-based Kinaxis, mentioned that many clients are reevaluating their supply chains in response to the tariffs. He emphasized that while the tariffs may begin affecting supply chains, the end result would be increased costs for consumers purchasing the products.
Addressing the potential impact on AI adoption, Bell highlighted a recent report by Bloomberg News, stating that Nvidia had notified customers about possible price hikes of up to 15 per cent for artificial intelligence chips. He noted that supply chain disruptions, including tariffs, could lead to cost escalations for components, affecting companies like Nvidia.
University of Toronto professor Light raised concerns about the rising prices possibly hindering AI adoption and deployment, suggesting that the increased expenses in both the U.S. and Canada might prompt a reassessment of investments in the AI sector.