The Canadian Kitchen Cabinet Association has expressed gratitude for the postponement of tariff increases on furniture, cabinets, and vanities by U.S. President Donald Trump. Despite the relief provided by the delay in tariff escalation, the industry continues to suffer significant losses due to the existing duties.
In October, Trump imposed 25 per cent tariffs on the sector, with a planned increase to 30 per cent for upholstered furniture and 50 per cent for cabinets and vanities starting January 1. Luke Elias, the association’s vice-president, acknowledged the partial relief from the 50 per cent tariff but emphasized that the industry is still struggling to cope with the initial 25 per cent duty.
The kitchen cabinet manufacturing sector in Canada, valued at $4.7 billion, annually exports about $600 million worth of products. The impact of Trump’s tariffs has compounded challenges for an industry already grappling with a soft Canadian housing market.
Ralph Fehr, the president of Manitoba-based Elias Woodwork, highlighted the detrimental effects of the 25 per cent tariffs on his company’s operations. With over 80 per cent of its products exported to the U.S., Fehr noted that a 50 per cent duty would have been catastrophic, questioning the viability of Canadian content at such increased costs.
Fehr emphasized the use of American materials in his company’s production processes, underscoring the longstanding relationship with U.S. customers. However, the tariffs have eroded profitability, prompting the company to explore cost-cutting measures to navigate the challenging business environment.
Elias, not affiliated with Elias Woodwork, emphasized the urgency of the situation, citing industry layoffs since the imposition of Trump’s tariffs. Concerns were raised at industry meetings regarding imminent job losses, underscoring the critical state of the sector.
Looking ahead, the association called for Ottawa to extend support policies to the building industry, including provincial incentives, to mitigate the impact of tariffs. Addressing the issue of parts imports below market value, particularly from Asia, was identified as a crucial step to safeguard the domestic industry.
As the review of the trilateral trade agreement (CUSMA) approaches, efforts to strengthen rules-of-origin requirements and prevent dumping of cheap products in Canada and Mexico are underway. The sector remains hopeful for government intervention to alleviate the challenges posed by the ongoing tariffs, ensuring the industry’s sustainability and competitiveness in the North American market.