Linamar Warns Ottawa: Defend CUSMA or Lose Manufacturing Edge

As of August 5th, 2025, Linamar's executive chair, Linda Hasenfratz, is pressing the Canadian government to vigorously defend the CUSMA (Canada-United States-Mexico Agreement) trade pact. Hasenfratz warns that any move to impose tariffs on auto parts could severely disrupt the industry's deeply integrated North American supply chain, potentially bringing the sector to its knees.

The automotive industry has faced significant challenges in recent years due to the trade war initiated by former U.S. President Donald Trump. However, within the industry, the majority of products crossing the border, particularly auto parts, have been CUSMA-compliant and operating under zero duties.

Nonetheless, Hasenfratz cautions that this could change, and she is urging the federal government to work hard to maintain the CUSMA agreement. She argues that dismantling the pact would have a devastating impact on the Canadian economy. CIBC Capital Markets economist Avery Shenfeld echoes this sentiment, stating that Canada's advantage from the CUSMA carve-out is only as strong as the agreement itself, which will lapse in 2026 unless all parties agree to renew it.

Hasenfratz remains optimistic that Canada's automotive sector will continue to be a pillar of the economy, with suppliers like Linamar poised for growth. She believes that if CUSMA stays intact, Linamar stands to benefit as its customers look to onshore products currently sourced from Asia and Europe, attracted by the favorable tariff costs.