Tariffs give rise to growth, innovation

There is no doubt that several Manitoba companies have been negatively affected by the unjust tariffs imposed upon our country by the Trump administration.

This was true even before Canada and the U.S. became officially mired in a trade war earlier this month when Canada moved forward with retaliatory tariffs targeting $20 billion of U.S. exports.

While U.S.-Canada trade relations have become even more fraught and frosty over the past several weeks, and the business climate highly strained due to the escalating trade war, it’s reassuring to see that there can still be solid opportunities for growth, even in bad situations.

In February 2025, shortly before Trump imposed his first round of tariffs — 25 per cent to the cost of all steel and aluminum imports into the United States — Atom-Jet Group owner Barry LaRocque was bracing for the potential impact.

An international company, Atom-Jet is a big employer in Brandon and provides products and services to the agricultural and industrial markets in Canada, the United States, Australia and Russia. But for a steel machining company that does a lot of business in the United States, the tariffs had become a significant issue.

“Obviously it’s going to affect our inputs for raw material, so that’s one effect,” LaRocque said at the time. “And you know, down the line, it depends where you put the increase, and if you don’t take a rate to the end user, then that’s going to affect your margins. If you take it to the end user, then that’s going to affect the selling price, which could affect your sales — not as many people might buy. It’s a concern right across the board.”

By June, his concerns had materialized, but not quite the way he first expected. LaRocque said that ultimately the tariffs themselves had less of an impact on his company’s products. The more concerning issue was the fact that Americans were buying less from them simply because they were Canadian-made.

He said that instead of customers making the decision to go ahead and buy a product, they were worried about the price of tariffs and the effect of the economy and the tariffs on different commodities in the United States. So instead of buying, “they’re just sitting back and waiting.”

But it’s not just the U.S. tariffs that were causing headaches for the company — tariffs on agricultural products by China have also been problematic. And the need for a change in direction has been obvious.

So in the year since, the company has been following the lead of the federal government and looking to pivot its operations to focus on expansion in other markets outside the United States. On Friday last week, that effort created a new opportunity when Atom-Jet announced it was set to expand its operations and increase in-house production with the help of $1 million in tariff relief through the federal Regional Tariff Response Initiative set up earlier this month.

The funds will support a 4,000-square-foot expansion of the company’s Brandon facility and allow the company to bring powder coating and sandblasting operations in-house, according to Liberal MP Ginette Lavack, parliamentary secretary to the minister of Indigenous Services, who was in Brandon to make the announcement.

“The investment is expected to generate approximately $6 million in revenue growth by 2028, and potentially up to $2.5 million of those $6 million would be in new export sales,” she said.

That is a significant investment, one that is expected to create another eight new positions within the company.

According to the Friday press release, the company also plans to expand direct-to-customer sales in Canada and Australia, helping to diversify its customer base and reduce its reliance on original equipment manufacturer customers and the U.S. market.

Atom-Jet is one of several Manitoba companies that have benefited from this tariff relief program. Innovair Industrial and Fort Garry Fire Trucks in Winnipeg have both received funding in recent days, along with several other smaller manufacturing companies in the province’s capital.

We don’t relish the reasons behind this need for change. The tariffs being imposed on Canadian businesses do nothing to improve commerce between trade-warring nations. But it must be said that opportunity is knocking for any major business that is looking to grow and innovate.

It’s the kind of thinking that our business community will need going forward.