"Holding a steel rod he's pulled from a cardboard box, import specialist Marc Ballelli believes he's found a problem. "They will classify this as an auto part but this is a steel tube," said Ballelli. Whether it's considered a steel product or an auto part can make a big difference, since there is a tariff on steel of 50 per cent, but Canadian-made auto parts are exempt from tariffs."
"Kaycee Vasudeva owns automotive parts manufacturer Ultra-Form Manufacturing and blames the economic slowdown caused by tariffs for losing a customer. It's forced him to lay off a dozen employees while at the same time create two new jobs in his company just to deal with the paperwork. "If I'm shipping it direct to USA and that's what we do quite a bit, that's what gives us the headache," said Vasudeva, who has been making auto parts for 30 years."
Automotive parts shipments crossing the Ambassador Bridge undergo inspections by U.S. Customs and Border Protection to verify tariff classifications. Customs distinguishes steel products, subject to a 50 per cent tariff, from Canadian-made auto parts, which are exempt. Classification disagreements can trigger investigations, retroactive tariffs and financial penalties that raise costs for companies. Tariff-related paperwork has shifted from routine administration to a priority compliance function handled by senior staff and new hires. One manufacturer reported losing a customer, laying off a dozen employees, and creating two positions solely to manage customs documentation and line-by-line classifications.
Read at www.cbc.ca
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