Top Canadian defence officials are reaffirming their country’s military and industrial ties with the USA, even as diplomatic relations between the North American allies hit their lowest ebb in over a century.
Canada’s defence minister Bill Blair, alongside science and industrial minister Francois-Philippe Champagne, concluded a trip to Washington, DC on 6 February aimed at strengthening cross-border cooperation in defence and aerospace procurement.
The pair met with undisclosed industry leaders, whom Ottawa describes as having “strong ties to the Canadian economy”, to discuss “opportunities to promote shared Canada-US defence and security objectives and economic prosperity” on both sides of the border.
“Canadians and Americans are safer thanks to our shared and integrated defence industrial base, which has been in place for over 80 years,” Champagne said on 6 February.
“Partnerships between our aerospace, space and defence firms, including our integrated supply chains, provide well-paying American and Canadian jobs while fuelling innovation and economic growth,” he adds.
That touting of mutually beneficial economic linkages comes as the new US president seems bent on dismantling or degrading many of the USA’s traditional trade relationships.
During his campaign to re-take the White House, Donald Trump had promised 25% blanket tariffs on Canadian imports to the USA. Just days before the two Canadian ministers arrived in Washington, Trump on 3 February agreed to delay the imposition of those duties for 30 days, after Prime Minister Justin Trudeau committed to strengthening border security and increasing efforts to counter drug smuggling.
Trudeau had vowed to impose reciprocal import taxes on American products going into Canada, if Trump followed through on his threat.
However, the slight cooling of tensions was short-lived, as Trump on 10 February imposed a separate 25% surcharge on all steel and aluminium imported into the USA, including supplies from Canada.
“It’s 25% without exception or exemption and that’s all countries, no matter where it comes from,” he said while signing the orders in the White House Oval Office.
Canada was the largest overseas supplier of steel to the USA in 2024, according to the American Iron and Steel Institute, sending some 6 million tonnes south of the border. Data from the US Department of Commerce indicates American manufacturers imported more than 3 million tonnes of aluminium from Canada in 2024 – a key mineral for the aerospace industry.
Even before he was formally sworn in, Trump created turmoil in Canadian politics by repeatedly suggesting he would seek to compel his northern neighbour into becoming a “ state” under Washington’s purview – a prospect roundly rejected by Canadian leaders.
The president has also repeatedly referred to Trudeau as governor (the American term for a state-level official), rather than prime minister. That sent Trudeau’s already tenuous premiership into a tailspin, forcing him into a state of deferred resignation while his Liberal party searches for a new leader.
Trump has effectively made use of his presidential bully pulpit to goad European allies into increasing defence spending. In this regard, Canada looks extremely vulnerable.
Ottawa has historically been a laggard when it comes to defence expenditures, generally failing to meet the NATO target of spending at least the equivalent of 2% of gross domestic product (GDP) on the military – which national leaders from alliance members pledged to meet at the 2023 NATO summit.
Previously widespread failure to reach that level has often been cited by Trump as an example of allies’ undue reliance on Washington for security.
The latest NATO figures put Canada’s defence expenditures at less than 1.5% of national GDP, with little prospect of reaching 2% any time soon.
In 2024, Ottawa unveiled plans for $5.5 billion (C$8 billion) in new military expenditures over the next five years. That surge in spending will include the procurement of some 140 new combat aircraft, including Lockheed Martin F-35A fighters and Boeing P-8A maritime patrol jets, alongside nearly $30 billion targeted for modernisations at the joint Canada-USA North American Aerospace Command (NORAD).
While that would represent a “near tripling” of defence spending, according to Blair, it would still leave Canada below the 2% threshold that is often on the mind of the current US president.
Against that backdrop, Blair and Champagne also met with elected members of the US Congress during their trip to Washington. The goal, according to Canada’s Department of National Defence, was to highlight the planned investments in military capacity and the historic ties between the two countries.
“Canada’s defence relationship with the United States benefits both countries and contributes to a safer and more secure continent,” Blair said on 6 February. “Strong partnerships with our allies, and their defence industries, positions Canada to better defend and deter emerging security threats.”
It remains to be seen whether such rhetoric will influence the US president and his tariff threat.
Also unclear is the potential impact to several major defence contracts between Canada and US manufacturers that are expected to begin deliveries in the coming years.
“We are carefully evaluating the announcement and will work with our suppliers to address any potential impacts,” Lockheed tells FlightGlobal.
The airframer expects to begin delivering the first of Canada’s 88 F-35s in 2026 under a 2023 agreement valued at $14.2 billion. Ottawa has already begun developing infrastructure to support the planned fleet, including a new quick reaction air base and launching a search for a new jet trainer.
Also potentially impacted is the Royal Canadian Air Force’s $10.4 billion procurement of P-8A Poseidon maritime patrol aircraft. Under a 2024 contract, Ottawa committed to acquiring at least 14 of the 737NG-based jets, with options for an additional two examples.
The aircraft alone are valued at $5.9 billion, with additional outlays on simulators, sustainment and other support equipment. Boeing had expected to deliver the first Poseidon in 2026.
However, that milestone may ultimately be delayed following a nearly two-month strike by the International Association of Machinists and Aerospace Workers (IMA) union that shuttered much of Boeing’s commercial aircraft production late last year.
“We are working to the latest P-8 production contract, which will account for the impacts of the strike and other production challenges,” the company said on 6 February.
A Boeing official not authorised to speak publicly on the matter says the the company is monitoring the potential imposition of tariffs on products crossing the US-Canada border.
General Atomics Aeronautical Systems (GA-ASI) speaks more bluntly on the matter, as the California-based company is working to fulfill Canada’s order for 11 MQ-9B remotely-piloted aircraft.
“We must constantly evaluate and re-evaluate our business operations based on evolving conditions, whether those are regulatory, policy, economic or some other shift,” the company said on 10 February.
“That’s just business,” notes C. Mark Brinkley, GA-ASI’s senior director of strategic communications. “It’s too soon to tell what kind of effects any changes in tariffs would have, and I don’t want to speculate on what might or might not happen.”
GA-ASI expects to deliver Canada’s first MQ-9B in 2028, with the full fleet of 11 aircraft to be in service by 2033.
The 2023 deal was at the time valued at roughly $2 billion.
