It's been 1 year since Trump's 'Liberation Day' tariffs

0:00The Trump administration is Hidina, key milestone in their push to shake up global trade. A year ago today, Donald Trump announced his Liberation Day tariffs, some of which were later overturned by the U.S. Supreme Court, but several remain in place. Steel and the Luminum tariffs are still being hit hardest. Canada's auto sector, softwood lumber, copper, and furniture industries are also feeling the pressure. Although there are carve-outs under the Canada U.S.-Mexico Free Trade Agreement, all of this sets the stage as Canada prepares for its upcoming Kusma Review Talks. My next guest is the founder and CEO of Border Works Logistics, it's a logistics company in southern Ontario with multiple warehouses, both in Canada and the U.S. Dean Wood joins me now. Dean, we've have spoken before. Last time you were on the show, you said that this would be a three to nine-month period of severe pain before something was negotiated, at least that's what you hoped. It's now been a year.

1:01Happy anniversary is definitely not, I'm glad you can chuckle. It has been going on a year, though. How's your business holding up? Well, it certainly has been painful for the year, a lot of our clients, because we handle their distribution and their products. It's still a time of uncertainty, still a time that's making many, many businesses very, very concerned about their largest trading partner in the United States and how to calm that situation down so that we can get back to growing our businesses. So everyone is still in a very cautionary period. We were hoping that we would have had a stronger relationship even through these times with the U.S., but it's evident that we don't have that right now. Yeah, that negotiation, you had your fingers crossed for, hasn't happened, though there are negotiations coming up. I can imagine what your hopes are for those, but tell me. Well, certainly, it is a time of renewal.

2:05The agreement doesn't go away for another 16 years, but it is a time when which all the countries involved, the three countries involved, if it chance to evaluate what their needs are. And obviously, there are needs that are being put on the table from the United States. I've traveled to Capitol Hill, I've met senators and congressmen. They're very, very clear that they love working with Canada. They see us as a great partner, but we have some issues that are on the table that they need and they feel that needs to be addressed. So it is our hope that we can bring those things to light, get a proper agreement in place with those issues that are seem to be rearing its head on a regular basis and bring it back to senility of being able to do trade again without the risk of tariffs coming at us. Can you give me some specific or tangible example of how you have been affected by what has actually been kind of on again, off again tariffs, really throughout the year? And to that, I guess, maybe explain to us.

3:06I mean, you have warehouses on both sides of the border, am I right? And so what are the products and how do you adapt? Do you just hold off on sending as long as you can or explain that? Well, we handle products on behalf of our clients. So we have everything from sports bottles to food products to manufacturing components that move across the border, the auto trade business, for example, as well as the consumer goods. So a couple of things happened. And they removed the de minimis, the under $800 low value shipments. There was probably 180,000 jobs just in southern Ontario that were directly affected by the fact that they could no longer do that. Now, some of those goods still cross the border and are subject to tariffs. But the tariffs are in such a place that some of those goods are no longer viable to even have a business that way. So we've seen businesses shutter their doors because it's not worth it.

4:08You've seen a lot of businesses 10 to 15% of the businesses decide to pull the trigger and put inventory directly into the United States, paying the duty on the cost instead of what they sell it for from Canada. And this has caused a reduction in resources being spent in Canada and an increase of resources spent in the US. We can't keep up with the demand on our US side and our Canadian side is a little bit lighter. We've not expanded our staff as much. We're not contracting, but we're not expanding it at this point. You know, you use the word de minimis. And I remember when that first sort of came about, I'm going to say maybe mid year or midway through this year that we've been experiencing. And I think a lot of Canadians, you know, had to get their head around. What does this even mean? But your clients, you and your employees that you know very well what that is and what it has meant. And you've kind of gotten into that. In terms of your employees and the fact that you haven't expanded it, this is being felt

5:09by your clients. Can you talk to me? Maybe feelings that are being shared. How are people feeling about this? Well, the topic of trade has never been so much of a coffee table conversation and a coffee shop conversation as it has in any recent years that I can remember. Our very employees, people that normally didn't pay much attention to that. When we do our town hall meetings, they're asking the questions, is this going to be okay? Are we going to have a trade agreement? What does this mean for our business? If it goes away, will we stop having business? Well, yes, business is still going to happen even though it's going to be more expensive. And you're going to have some players that are going to lose out in that because it's just not going to be viable for them. So it is a topic that's still very much a concern with folks. What we need is a strong and positive relationship with our largest trading partner in the United States. Even though we receive sometimes antagonistic comments back, we need to be Canadian.

6:16We need to use what we call quiet diplomacy. Don't do it on the front page. Don't do it for political gains. Stay quiet, stay focused because that relationship for Canada means so much to Canadians. There's so many that are tied to U.S. companies, even for their paychecks, let known the supply chain. One simple component in a car seat moves eight times across the border before that car is built. We can't afford to disengage in those kinds of relationships. They would just cost too much both sides of the border.