00:00:44.640No more selling Bombardier in the United States.
00:00:47.580If they want our market, they must build here and stop treating America like a piggy bank.
00:00:53.940Bombardier says its workers are based all over the United States, with direct employment in more than 20 states and sites in 10 states, including California, Texas, and Arizona.
00:01:05.140The company added that its aircraft are built with American-made components, such as engines, avionics, and many more key systems provided by American companies.
00:01:17.460Our guest today is business consultant and commentator Kirk Lubomoff, coming to us from Calgary.
00:01:22.440Welcome Kirk. So Canada's tariffs on the United States are taking effect today. What do you
00:01:27.360anticipate will be the impact on us in Canada? Well, the tariff retaliation is going to spread
00:01:34.620some of the pain across more provinces. Trump's tariffs on Canada is really particular more on
00:01:43.480BC and some parts of Eastern Canada. And Canada's response, which they are dialed back in some
00:01:50.140uh in some industries like the fishing industry um is gonna focus on uh it'll bring essentially a
00:01:57.260little more pain to alberta than trump's tariffs are so uh it's a little more spread provincially
00:02:04.380than uh the uh than to original tariff attack meantime you have bombardier pushing back against
00:02:11.740trump saying and we're all over the united states we're in a total of 20 states we employ people
00:02:17.260there with we have sites in 10 different states you find it surprising that trump apparently
00:02:22.700didn't know this well you know this is actually such a good example to to the relationship that
00:02:29.420canada to us has in our industries uh it is obviously that the the trump singling out
00:02:36.700bombardier is as an attack on the liberal stronghold uh on eastern canada onto provinces
00:02:43.580that the U.S. has claimed that the liberal administration has broke the negotiations for
00:02:51.900the by-elections. But this is such a good example because Bombardier is heavily involved into the
00:02:59.740U.S. economy. They employ directly, as you said, thousands of people, indirectly, secondary
00:03:04.860industries, thousands more. And this is a good example that shows just how much of our industries
00:03:10.380work together there's parts across the border all the time and especially in the outer industry as
00:03:15.980well that they are trying to decouple as well uh it's such a good example of again it just it does
00:03:23.100not make any sense as some of the specific tariff attacks that's going on yeah meantime we've got
00:03:28.860uh lombardi pushing back against trump as you saw and as you've heard uh i mean will that be enough
00:03:36.060though i guess that's the real question you know the fact that bombardier has pointed
00:03:39.980out that it's you know a huge uh manufacturer of products in the usa will that be enough to prevent
00:03:48.300uh trump from moving forward with the ideas of stopping any bombardier sales in the u.s you
00:03:54.540think that'll be enough i think so and i think there's two really parts it one i think is the
00:04:00.700miscalculation by trump because when you do this kind of attack by in you know leading up to the
00:04:06.620midterms when the company responds listen here's all the places we actually employ thousands of
00:04:12.220people in it does not make you look good so it was a poor political choice the other aspect of
00:04:17.420it trump can't really just you know with a stroke of a pen ban a company from doing business in in
00:04:24.620in their country right especially when there is a direct supply chain and manufacturing relationship
00:04:30.140it just it just does not happen so it's an emotional outrage but i just don't see what the
00:04:36.380win is in it for him do you have any thoughts on what happened in terms of the breakdown
00:04:42.060of talks we haven't really spoken uh since that happened i mean you've heard both sides by now
00:04:48.300where you had people like howard latnik coming forward and saying i thought we had a deal
00:04:52.700and it was their side that called us and seemed to be pushing for the whole thing to be scuttled
00:04:59.100And then you have our own prime minister and his version saying, no, this was about protecting Canada, Canadian workers, Canadian cultural institutions, protecting the French language.
00:05:11.280And then you had Lutnik come up and says, what do we care what language they speak in Quebec?
00:05:51.700But the truth is somewhere in the middle.
00:05:54.080when it you know and it really benefited the liberal government when latnik said we don't
00:05:58.640care about the french aspect of it a huge bonus of course uh uh the liberals respond right away
00:06:05.120oh perfect good so one condition is off the table so that was that was an excellent play uh in the
00:06:10.880moment the the the real aspects in that was that um it's not as much about the french languages
00:06:18.480was about the algorithm discoverability of french programming in the canadian market which is a
00:06:25.120really stupid thing to kind of try to enforce on a streamer and the reason is streamers have built
00:06:33.040and spent millions hundreds of millions on an algorithm to deliver you what you want to watch
00:06:38.880they you know their their whole pro the whole platforms are based on hours watched so they
00:06:45.040know exactly what people want to watch if you think if they think you want to watch more french tv
00:06:50.080more french language shows they will deliver it to you on a silver platter so the government
00:06:54.960enforcing something that has no strong business case in particular it just doesn't make any sense
00:07:00.720to them the other aspect of that angle was that they trying to tax companies and that was from
00:07:08.000one of the horrible bills by the liberals to pay uh for canadian content production
00:07:15.680the error here was instead of just saying wait we're going to increase the cost of streaming in
00:07:22.080canada force for those platforms they literally said we're going to take money from you so we can
00:07:28.720give it to those people over there so it's just a glorified wealth transfer of course the companies
00:07:34.800going to object to it and went to court on it. So it's just an awful policy to begin with.
00:07:41.440The other really big problem is the industries in Canada, like the auto industries, have given
00:07:50.160a line in dissent to the Liberal government saying, we cannot operate here with any amount
00:07:55.360of tariffs. It's just uneconomical. It makes no sense when you, for example, you know,
00:08:01.520take aluminum from canada gets tariff sent to the u.s turn into uh gets uh you know press into a
00:08:08.800sheet gets sent back into canada gets tariffed again then it turns into a product auto part
00:08:16.080sent to the u.s put into a different auto part gets tariffs again gets sent to to canada put
00:08:21.760into a car and then sent to the u.s gets tariffed again it's just the whole process doesn't make
00:08:26.560any sense so the auto industries on other industries they've given liberals a line at
00:08:32.880the center they cannot cross with tariffs and the line is really zero um the what the trump
00:08:40.000administration is trying to do is increase all tariff levels globally and when they say they
00:08:46.480gave canada the best trade deal it does not mean it's a better trade deal than we have now it just
00:08:52.400mean it's relatively better deal than what they want to offer other countries and they're trying
00:08:57.520to establish the canadian trade deal as a foundational uh stepping stone so they're
00:09:03.120trying to raise all of our tear all of our trading costs between the two countries up so they're
00:09:08.960trying to establish five ten fifteen percent tariffs on some industries where it just does
00:09:14.800not make any financial sense for those companies to operate under those conditions and that's one
00:09:18.880one of the reasons to walk away the other aspect of it there was miscommunication by both sides i
00:09:23.760would say about the heavy duty trucks uh the way canada approached this is auto industries
00:09:30.480all of auto industries and the us approach it is in light duty and heavy duty uh so they wanted
00:09:38.800have higher tariffs on the heavy duty aspect of the auto industry import which of course does not work
00:09:46.480there was a dismal job report last week in which canada lost i think it was 42 000 something like
00:09:54.160that over 40 000 jobs 42 yeah right so there's also an investing summit in canada and i mean
00:10:03.440we keep being told that things are okay in canada you know but it's hard to reconcile that with what
00:10:11.200just took place in terms of the loss of so many jobs in an economy the size of ours. Meanwhile,
00:10:17.720the U.S. added over 160,000 jobs. But this investment summit in Canada comes at a time
00:10:25.200when you have Melanie Jolie, the cabinet minister, saying that, you know, companies are not going to
00:10:31.080be just allowed to leave. You know, I don't know if you've caught that, but she actually seemed to
00:10:36.340be suggesting that firms that are heavily invested here can't just, you know, get up one day and
00:10:42.600leave just because they want to. And I'm wondering if that's going to be a difficult thing for some
00:10:48.540possible investors, prospective investors in Canada to look at that and go, wait a minute,
00:10:53.840so this is like a roach motel. You know, we come in and invest millions of dollars setting up
00:10:59.820operations, and then you're going to tell us whether or not we can leave or not down the road.
00:11:04.940And does any of this make sense? What do you think of this investment summit? Good idea, bad idea?
00:11:11.760I think in general, it's a great idea because we should technically have those. Why not? Let's promote what we can do. The problem is it's how it's happening and some of the details around it.
00:11:23.980so just uh so the investment summit is next week and in the next couple days here the liberal uh
00:11:30.460the liberals are meeting in band from a little powwow and uh talking to industries and uh you
00:11:35.820know talking about how they can build at speeds we have never seen you know that that model that
00:11:40.380seems to doesn't some seem to come to fruition uh so and this is exactly the issue right let's
00:11:48.380how do you advertise to invest in canada when canadian companies are reluctant to invest in
00:11:53.900canada let's do let's take the pipeline as an example we keep saying we need to diversify from
00:12:00.140the us we have a pipeline project that we know a good 80 of the route because we built a tmx
00:12:06.700expansion right next to it and it's still somehow sitting in paperwork mode for a year for no
00:12:13.500particular reason it requires carbon captured uh project to go along with it for no particular
00:12:19.740reason so then think about it as a 25 26 billion dollar uh penalty to do business in canada and
00:12:27.500not only that there is not a single private sector industry in canada that says yes we want to be a
00:12:33.100part of it you know they put an oil uh companies essentially initials on it with uh with uh just
00:12:40.940so they can put it into the major projects office that exists for no particular reason so you know
00:12:46.940how do you lead by example by showing that local companies cannot navigate or trust your own red
00:12:52.940tape that the liberals refuse to remove and then you're saying oh come to invest on top of it it's
00:12:59.420you know why not clean out all this backlog of junk that we have sitting from a regulatory point
00:13:05.180and then bring come bring the investors to say hey we actually are open to business we actually
00:13:11.020want to want you to invest no ifs or buts and no red tape involved this that'll be a different
00:13:16.700story and this is exactly what they should be doing instead of saying hey come here but here
00:13:22.460is all the things you have to spend on money first before you put a dollar into this country
00:13:27.980yeah on the energy front you also have chevron now coming out and investing in venezuela
00:13:32.380after the Trump administration signed a $60 billion deal with that country.
00:13:39.540Heavy crude, which, of course, is similar to the same type of product that we produce in Alberta.
00:13:45.820I mean, this is not good because, I mean, exacerbating our trade problems with Trump
00:13:52.920is going to backfire and is backfiring on the energy front.
00:13:57.240I mean, that's the one thing that we get so much of our revenues from
00:14:00.920is through the sale of energy to the United States.
00:14:03.920We don't have the infrastructure really to ship to Europe.
00:14:09.100We are shipping some to China, as you know, right?