The boss of a Quebec SME plans to increase its production in the United States to avoid as much as possible the customs tariffs that Donald Trump promised to impose on Canadian products.
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This tariff threat and the new restrictions on temporary immigration to Canada, “it tells us “you have to go to the United States, that’s where you have to manufacture”… It’s is a little weird,” notes Julien Veilleux, president of Rotobec, an industrial equipment manufacturer in Sainte-Justine, in Chaudière-Appalaches.
“Bad news”
“All of this is bad news for Ste-Justine,” laments Mr. Veilleux.
“The know-how, the engineering, the programming are still in Sainte-Justine, so it would be much easier to invest here than in New Hampshire,” he adds.
In response to changes in Canadian immigration policies, Rotobec recently initiated a project to expand one of its two New Hampshire plants.
The new facilities will not be ready before the end of 2025, or even next year, but they could still be very useful if the standoff with Washington were to continue.
“The threats, in my opinion, are serious. Something is going to happen,” says Julien Veilleux.
“It is certain that [l’administration Trump] will take advantage of our weaknesses. We have economic dependence on the Americans and we do not have a leader in place,” he continues, referring to the upcoming departure of Justin Trudeau.
Limited capacity
Before Mr. Trump arrives at the White House on January 20, Rotobec will send inventory to the United States to escape tariffs.
Subsequently, the company will increase its production in New Hampshire, but this solution has limits.
“Our two factories in the United States are not capable of supplying,” says Mr. Veilleux.
Rotobec derives approximately 55% of its turnover from its American customers. The company produces in New Hampshire about 60% of what goes to them.
Production carried out in Quebec and exported to the United States would therefore be hit hard by possible American tariffs.
“The question we ask ourselves is: are we taking a portion of it from our margins? [de profit]? Shall we charge a portion to our American friends for a certain period of time?” explains Julien Veilleux.
Rotobec en bref
Fondation: 1975
Employees: 425
Products: loaders and material handling grapples for the forestry, waste and scrap metal sectors
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