Canada to invest billions in tariff-hit steel and auto sectors

Canada's Prime Minister Mark Carney and Ontario Premier Doug Ford announced an C$8.7B ($6.2B) support plan for the steel and auto sectors, which have been strained by U.S. tariffs, as well as the domestic critical mineral supply chain.

The support package includes a new Joint Steel Action Fund, with five-year commitments of C$3.55B ($2.5B) from Canada and C$1.67B (~$1.2B) from Ontario.

Carney said the funding "will enable steel mills and companies to upgrade machinery and manufacture more products Canada needs and to expand to meet demand in non-U.S. markets."

The government will also prioritize Canadian steel in public procurement as well as strengthen protections against foreign steel dumping and unfair subsidizing.

For the auto industry, Canada's and Ontario's governments will invest an additional $2.5B over two years. This will enable automakers to invest in modern machinery and upgraded production lines to build connected and electric vehicles.

Canada will also maintain emissions standards for new light-duty vehicles at 2026 levels through the 2029 model year, with annual hikes resuming in the 2030 model year.

For the critical mineral supply chain, Ottawa will invest up to $1B over three years to build road infrastructure in Ontario's Ring of Fire region, matching the provincial government's previously announced funding.

The support package comes as Canada is weighing legal options against Cleveland-Cliffs (CLF) over its layoff plan in Ontario, including fines and a potential sale of its Canadian assets. Around 500 workers could lose their jobs as the company is set to idle cold-rolled and coated steel operations in Hamilton, Ontario.

Meanwhile, unionized Stellantis (STLA) workers in Canada this week voted for a potential strike as contract talks remain at a stalemate over the automaker's plan to sell an assembly plant near Toronto.