Canadian Manufacturers Move Production to U.S. to Avoid Tariffs

Canadian manufacturers are relocating operations to the United States or closing facilities to avoid 50 percent tariffs imposed by the federal government of the United States on products including paper and packing containers. Michael Leiberman, founder and president of Aeris Protective Packaging Inc., is opening a U.S. manufacturing plant because 70 percent of his clients are based in the U.S. and the tariffs increased consumer prices by 50 percent.

Other companies are following suit or scaling back. Sapporo/Sleeman Breweries plans to move U.S.-market beer production to the United States by early 2027, and Crown Royal previously moved its bottling plant to Alabama. In contrast, Rayonier Advanced Materials announced an indefinite temporary shutdown of its Quebec paperboard mill, affecting over 400 workers, while Stellantis has entered talks to sell its idle Brampton Assembly plant.

The industrial shift coincides with severe economic instability. Canada lost 42,000 jobs in August 2026, far exceeding economists' predictions of 15,000 job gains. Prime Minister Mark Carney has characterized the tariffs as the U.S. "waging war" on Canada and has reportedly taken negotiations off the table. This follows the Canadian government's imposition of retaliatory counter-tariffs on $27.6 billion of U.S. imports.