Raphael Stevens

Canada’s 25% auto tariffs took effect Wednesday on U.S.-produced vehicles, but the new levies differ in many ways from those implemented last week by President Donald Trump.
Canadian officials purposely carved out individual auto parts from the tariffs and are taking into account the United States-Canada-Mexico Agreement, or USMCA, trade deal into the new levies.
There also could be some relief for automakers on the Canadian tariffs in the form of remissions.

Trucks make their way to the Ambassador Bridge to cross into the United States at Detroit on April 1, 2025 in Windsor, Canada. 
Bill Pugliano | Getty Images

DETROIT — Canada’s 25% auto tariffs took effect Wednesday on U.S.-produced vehicles and many parts in American cars and trucks, but the new levies differ in important ways from the U.S. tariffs implemented last week by President Donald Trump.
Canadian officials purposely carved out individual auto parts from the tariffs and are taking into account the United States-Mexico-Canada Agreement, or USMCA, trade deal with the new levies. There’s also a remissions process that could allow companies some relief from the duties, according to Canadian officials.

“We are responding today with, and we responded throughout with, carefully calibrated and targeted counter tariffs,” Canadian Prime Minister Mark Carney said during a Thursday news conference announcing the actions.
Canada’s response, which it reconfirmed Tuesday, includes 25% tariffs on vehicles from the U.S. that are not compliant with the USMCA — or CUSMA, as Canada refers to it — as well as non-Canadian and non-Mexican content of USMCA-compliant fully assembled vehicles imported into Canada from the U.S.
The latter part means that even if a vehicle made by General Motors, Ford Motor or Chrysler parent Stellantis in the U.S. is compliant with the USMCA, the parts that aren’t from Canada and Mexico could be taxed, pending a remission process.

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Trump’s 25% tariffs, meanwhile, are on any vehicle not assembled in the U.S., which S&P Global Mobility reports accounted for 46% of the roughly 16 million vehicles sold domestically last year. The White House has said it also plans to place tariffs on some auto parts such as engines and transmissions by May 3.
Flavio Volpe, who leads the Automotive Parts Manufacturers’ Association in Canada, said his organization believed it was crucial to have the individual automotive parts carved out because tariffs on those products could rapidly shut down the North American auto industry.

“What we advised the prime minister was ‘keep parts out of this for now,'” he told CNBC on Tuesday. “We also insisted that if you’re going to do counter tariffs, make sure you’re targeting American. Don’t by accident or by omission hurt our Mexican sources, partners. Nobody wants to do this … but Canada has to respond.”
Mexico content was exempted, unlike the U.S., because the country is honoring the USMCA North American trade deal, Carney said last week.
GM, Ford and Stellantis each separately said their North American-produced vehicles are compliant with the USMCA, however the content of each varies greatly.
The traditional “Detroit automakers,” as well as Toyota Motor, are among the top-selling car companies in Canada. The country’s overall market is far smaller than the U.S., at roughly 2 million light-duty vehicles compared with around 16 million in the U.S.
Canada’s trade balance in regard to light-duty passenger vehicles was $8.33 billion, with $43.82 billion exported against $35.49 billion imported, according to leading Canadian auto firm DesRosiers Automotive Consultants.
Trade imbalances have been one of the driving forces for Trump’s implementation of the tariffs.

Remissions?

There could be some relief for automakers on the Canadian tariffs.
Officials said “a remission framework for auto producers that incentivizes production and investment in Canada, and helps maintain Canadian jobs, will also be implemented.”
Canadian officials in a press release Tuesday said more details about the program will be “announced shortly.” The Department of Finance Canada, which released the news, did not respond for a request for comment.

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“We are planning to ensure that the automakers do stay in Canada,” Canadian Minister of Industry Anita Anand said Monday on CityNews in Canada. “We actually are talking about a framework that we’ll put in place, we call that out remission framework, to ensure that Canadian production and investment is part of the long-term plan to maintain Canadian production.”
Trump has said that there would not be exemptions for the U.S. tariffs, despite automakers lobbying for carve-outs for vehicles and parts that are compliant with the USMCA, which Trump negotiated during his first term in the White House.
Five automakers — Ford, GM, Stellantis, Toyota and Honda Motor — were estimated to produce 1.3 million light-duty vehicles last year in Canada, largely for U.S. consumers, according to Trillium Network for Advanced Manufacturing.
The carmakers did not immediately respond regarding the Canadian remission process.
Carney last week said Canada’s new levies are expected to generate 8 billion Canadian dollars ($5.6 billion), which will be used to help workers and companies affected by Trump’s tariffs. Vehicle imports from the U.S. totaled CA$35.6 billion in 2024, according to the Department of Finance Canada.

‘Unjustified, unwarranted … misguided’

Canada’s Prime Minister Mark Carney speaks to reporters as he arrives on Parliament Hill to attend a meeting of the cabinet committee on Canada-U.S. relations and national security in Ottawa, Ontario, Canada, April 2, 2025. 
Patrick Doyle | Reuters

Carney spoke bluntly about his disdain for the U.S. tariffs, which he called “unjustified, unwarranted and … misguided.” He also painted a dire future for the friendly relationship between the U.S. and Canada.
“That era has now ended unless the United States and Canada can agree on a new comprehensive approach,” Carney said. “While this is a tragedy, it also is the new reality. We must respond with both purpose and force.”
The U.S. and Canada have participated in a tariff-free trade deal that covers the automotive industry since the Canada-United States Automotive Products Agreement, commonly known as the Auto Pact, in 1965.
Canada is attempting to fight Trump’s tariffs in other ways as well, claiming they are illegal. The country on Monday filed a dispute with the World Trade Organization concerning Trump’s 25% tariffs on automobiles and automobile parts imported from Canada into the U.S.
The Canadian automotive industry has been on an upswing following a decades-long decline that escalated during the Covid pandemic.
Light-duty vehicle production in Canada hit 1.54 million vehicles last year, up from a recent low of 1.1 million in 2021, but still a 47% decline from the country’s peak of 2.9 million in 2000, according to industry data provided by the Global Automakers of Canada trade association.
“Canada continues to respond forcefully to all unwarranted and unreasonable tariffs imposed by the U.S. on Canadian products. The government is firmly committed to getting these U.S. tariffs removed as soon as possible, and will protect Canada’s workers, businesses, economy and industry,” François-Philippe Champagne, Canadian minister of finance, said Tuesday in a statement.

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Walmart-owned Sam’s Club plans to open 15 clubs per year and renovate all of its approximately 600 locations in the U.S., CEO Chris Nicholas said Wednesday at an investor day.
The warehouse club is speeding up its expansion plans, even as tariffs rattle Wall Street and injected fresh uncertainty about the economic outlook.
Club rivals, Costco and BJ’s Wholesale, also have aggressive plans for new stores.

Sam’s Club is opening a store in the Dallas area that will require customers to go all digital. Shoppers will use a smartphone app to scan and pay for their own purchases rather than standing in a checkout lane.
Sam’s Club

DALLAS, Texas — Walmart-owned Sam’s Club plans to supercharge its expansion by opening about 15 new stores per year going forward and remodeling all of its approximately 600 locations across the country, the warehouse club’s CEO Chris Nicholas said on Wednesday.
With the boost from those new locations, Sam’s Club aims to double its membership over the next eight-to-10 years, he said at Walmart’s investor day.

Sam’s Club already had aggressive expansion plans. The chain announced two years ago that it would open about 30 new stores in the U.S. over the next five years. That was a shift after Sam’s Club shut 63 locations across the country in 2018.
Yet Sam’s Club is speeding up expansion at a surprising time: President Donald Trump’s broad and steep tariffs have shaken Wall Street and injected fresh uncertainty about price increases, the U.S. economic outlook and consumers’ willingness to spend. The retailer pulled its first-quarter operating income forecast earlier Wednesday, saying profits could suffer if it tries to keep prices steady when costs increase due to tariffs.
In an interview with CNBC, Nicholas said he’s confident that demand for Sam’s Club will hold up, even if the economic backdrop gets worse. In fact, he said, the warehouse club’s focus on saving customers money may gain even more relevance.
“In times of plenty, we do well. But in tough times, we do really well,” he said.

Warehouse clubs gain traction

Warehouse clubs, including rivals Costco and BJ’s Wholesale, have benefitted from U.S. consumers seeking value and larger quantities of items over the past five years while stocking up during the pandemic, weathering Covid-related supply chain shocks and looking to avoid higher prices from inflation.

Sam’s Club rivals Costco and BJ’s Wholesale Club are both expanding, too. Costco, which has roughly 620 locations in the U.S., expects to open 28 new clubs during its current fiscal year, including three planned relocations of current clubs, its CEO Ron Vachris said in early March on an earnings call. He did not say how many of those clubs will be in the U.S.
BJ’s, a Massachusetts-based retailer that’s historically had more clubs on the East Coast, announced plans to open 25 to 30 new locations over the next two fiscal years, including in parts of Florida, Georgia, Tennessee and Texas.
Sam’s Club began its recent expansion by rolling out a club designed to represent its future. The new location, which opened in the Dallas suburb of Grapevine, Texas in October, was its first new store since 2017. The location, which replaced one destroyed by a tornado, has a new look and an all-digital approach to retail. It has no checkout lanes, store displays of online-only items and a larger area for fulfilling e-commerce orders for curbside pickup and home delivery.
Sam’s Club will take that store format nationwide as it remodels and opens new clubs, Nicholas said.
By the end of this fiscal year, Sam’s Club will have opened a total of three new clubs in Grapevine, Texas; Tempe, Ariz. and Lebanon, Tenn. It plans to start construction of seven additional locations that won’t open this fiscal year, as it ramps up store openings to the around 15 clubs per year pace.
The warehouse club is opening a wave of new stores as it tries to sustain strong sales growth.
Net sales for Sam’s Club totaled $90.2 billion in the most recent fiscal year that ended in late January. That represents a roughly 53% jump from the pre-pandemic fiscal year that ended in early 2020.
Sam’s Club’s comparable sales rose 5.9% year over year in the most recent fiscal year, excluding fuel.
Customer transactions across the website and store rose 5.4% in the company’s most recently reported quarter, which ended in late January. E-commerce sales shot up 24% during the period, as more customers ordered online for store pickup or got purchases dropped at their doors.
Sam’s Club does not disclose its total number of members, but reported that membership income rose 13% in the fiscal fourth quarter.
Nicholas declined to say how much Sam’s Club’s renovations and new clubs will cost. Its parent company Walmart has stepped up investments across its business, including remodels of its namesake stores and automation of fulfillment centers and other supply chain facilities.
Walmart spent $23.8 billion on capital expenditures in the fiscal year that ended in late January. In the current fiscal year, the discounter said it plans to spend between $20.24 billion and $23.61 billion on capital expenditures, including supply chain technology, store remodels and new clubs. More

Delta Air Lines CEO Ed Bastian called President Donald Trump’s tariffs “the wrong approach.”
The airline cut its growth plans and said it can’t reaffirm its 2025 financial guidance.
Delta last month lowered its first-quarter forecast due to disappointing bookings.

Delta Air Lines won’t expand flying in the second half of the year because of disappointing bookings amid President Donald Trump’s shifting trade policies, which CEO Ed Bastian called “the wrong approach.”
Delta on Wednesday forecast its second-quarter revenue to decline up to 2% or grow as much as 2% over last year, while Wall Street had been expecting growth of 1.9%. The airline expects adjusted earnings per share of $1.70 to $2.30, compared with analysts’ estimates of $2.23 a share.

The carrier also said it is too early to update its 2025 financial guidance, a month after it confirmed the targets at an investor conference, though the carrier said Wednesday it still expects to be profitable this year. Last month, Delta cut its first-quarter earnings outlook, citing weaker-than-expected corporate and leisure travel demand.
It is a shift for Delta, the most profitable U.S. airline, which started 2025 upbeat about another year of strong travel demand, with Bastian predicting it would be the “best financial year in our history.”
His new comments show growing concern among CEOs about consumers’ souring appetites for spending and the impact of some of Trump’s policies. In November, Bastian said the Trump administration’s approach to industry regulation would likely be a “breath of fresh air.”
Wall Street analysts have slashed their earnings estimates and price targets for airlines in recent weeks on fears of slowing demand.
“In the last six weeks, we’ve seen a corresponding reduction in broad consumer confidence and corporate confidence,” Bastian told CNBC. He said that demand, overall, was “quite good” in January and that things “really started to slow” in mid-February.

Bastian said main cabin bookings are weaker than previously expected. He said that travel demand that was growing about 10% at the start of the year has since slowed because some companies are rethinking business trips, the Trump administration cuts the government workforce and markets reel. The White House didn’t immediately respond to a request for comment.
He said international and premium travel have been relatively resilient.
Delta planned to expand flying capacity by about 3% to 4% in the second half of 2025, Bastian said in an interview. Now the carrier’s capacity will be flat year-over year.
“We expect this to be the first of many 2H25 capacity reduction announcements from the airlines this quarter,” TD Cowen airline analysts Tom Fitzgerald and Helane Becker wrote after Delta released its outlook.

Delta Air Lines planes are seen parked at Seattle-Tacoma International Airport on June 19, 2024 in Seattle, Washington.
Kent Nishimura | Getty Images

“With broad economic uncertainty around global trade, growth has largely stalled,” Bastian said in Wednesday’s earnings release. “In this slower-growth environment, we are protecting margins and cash flow by focusing on what we can control.”
Delta is the first of the major U.S. carriers to report earnings. United, American, Southwest and others are scheduled to report later this month.
Here’s how the company performed in the three months ended March 31, compared with what Wall Street was expecting, based on consensus estimates from LSEG:

Earnings per share: 46 cents adjusted vs. 38 cents expected
Revenue: $12.98 billion adjusted vs. $12.98 billion expected

In the first quarter, Delta’s net income rose to $240 million, up from $37 million last year, with revenue up 2% year over year to $14.04 billion.
Stripping out Delta’s refinery sales, Delta posted adjusted earnings per share of 46 cents, up 2% from last year and above analysts’ expectations, and adjusted revenue of $12.98 billion, up 3% from last year and in line with Wall Street expectations. More

Walmart pulled its operating income guidance for the current quarter, citing uncertainty about the potential impact of sweeping tariffs on its business.
In a news release, the discounter said it wants to “maintain flexibility” in case it has to spend more to keep prices low.
The big-box retailer reaffirmed its full-year guidance ahead of an investor event on Wednesday.

A Walmart Supercenter in Burbank, California, on Nov. 21, 2024.
Allen J. Schaben | Los Angeles Times | Getty Images

DALLAS — Walmart on Wednesday pulled its outlook for operating income in the first quarter, citing uncertainty about the potential impact of sweeping tariffs on China, Vietnam and other key sources of goods across the globe.
In a news release, the discounter said it wants to “maintain flexibility to invest in price as tariffs are implemented.” It did not provide a new range for first-quarter operating income. It had projected an increase of 0.5% to 2.0% in adjusted operating income in the fiscal first quarter.

Walmart maintained its first-quarter sales outlook of 3% to 4% growth.
The retailer made the move the same day that President Donald Trump’s sharp tariffs took effect on significant manufacturing hubs that produce some of the goods that it carries. The duties began at 12:01 a.m. ET, including an expected 104% tariff on imports from China and a 46% levy on imports from Vietnam.
Yet the long-term fate of the tariffs remains unclear, as Trump sends mixed signals about his willingness to strike deals with some countries to lower the duties. Treasury Secretary Scott Bessent has said some 70 countries have reached out to the White House for talks about the levies.
Walmart’s announcement comes as major U.S. companies start to speak out about the uncertainty the tariffs have created for their businesses. Delta also said bookings have suffered due to the trade war and said it will not expand flying in the second half of the year.
Though it said the uncertainty around tariffs made it hard to predict first-quarter operating income, Walmart stuck by its full-year guidance. The discounter said in February that it expects full-year net sales to grow 3% to 4% and adjusted operating income to increase between 3.5% and 5.5% on a constant currency basis. That includes a 1.5 percentage point headwind from acquiring smart TV company Vizio and from having a leap year in 2024.

The company said in February that it expects full-year adjusted earnings of $2.50 to $2.60 per share, which includes a 5 cent per share headwind from currency.
Along with tariff-related uncertainty, Walmart also blamed pulling the first-quarter operating income guidance on insurance-related costs and a less favorable mix of merchandise. The company’s leaders have spoken frequently about how inflation has made U.S. consumers more value conscious and selective, causing some to buy lower-margin necessities like groceries and household items instead of higher-margin items like clothing.

Walmart in ‘a fluid environment’

Walmart’s announcement came ahead of an investor presentation on Wednesday by the retailer’s top leaders. It is part of a two-day event in Dallas.
In his opening remarks on Tuesday, CEO Doug McMillon acknowledged the strange time that the retail giant found itself in.
“Clearly, our environment has changed, so that makes this really exciting for us,” he said, eliciting a laugh from the room of investors, bankers and reporters.
“We’ve learned how to manage through turbulent periods,” he said. “Especially these last couple of years, it has been one thing after the other.”
“It’s clearly a fluid environment,” he said. “And while we don’t know everything that’s going to happen, of course, we do know what our priorities are, and we know what our purpose is, and we’ll be focused on keeping prices as low as we can. We’ll be focused on managing our inventory and our expenses well.”

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