As U.S. protectionism intensifies, Canada must invest in domestic military production to stabilize jobs and supply chains. Roshel’s rapid scalability makes it a candidate for national priority.
I wrote “A Strategic Pivot: Securing Canada’s Steel, Aluminum and Auto Industries Through Defence Production“ in mid-February. I argued that rising tariff threats from the United States and Canada’s need for a significant military buildup could be partially addressed by shifting a portion of the auto sector to defence production.
Here’s an excerpt:
“When we consider taking any kind of action, it is important to consider the consequences not only of that action but also the consequences of inaction.
If the U.S. were to go all out in an attempt to destroy the Canadian auto industry and cripple our steel and aluminum sector, failing to take action would lead to massive job losses.
Further, losing the ability to produce steel and aluminum, and losing the ability to produce vehicles would be not only a severe economic loss but also a strategic vulnerability.
If Canada were to be plunged into war, we would need to be able to produce military equipment using Canadian resources and Canadian workers in Canadian factories. If we lose the steel and aluminum industries, and if the auto sector collapses, we will become even more vulnerable than we already are.
Right now, Canada needs to be doing everything possible to become less vulnerable and instead become more resilient. We may not be able to control what the United States does or what other countries do, but we can control how we respond.”
In this article, I will go into more detail on how we can use domestic defence production to protect auto sector jobs and industrial capacity. This is particularly relevant, given we are seeing increasing signs of stress on the sector.
Industrial Stress Signals Need for Strategic Realignment
General Motors is idling its Ingersoll, Ontario, plant until October amid a retooling. Workers will be laid off. And when the plant resumes production, 500 jobs will not return.
On April 3rd, Stellantis announced a two-week closure of its Windsor Assembly plant.
These closures & shutdowns – even when temporary – signal escalating pressure on the Canadian auto industry. This pressure is being applied from various directions. Tariffs, a mismatch between projected EV demand and real EV demand, US-induced chaos and resulting global economic instability paralyzing investment and dampening consumer sentiment, are all having a negative impact on the sector.
U.S. tariff policy reversals have introduced volatility into the trading environment (Chinese-made smartphones, computers, semiconductors, solar cells, flat screen TVs, SSDs, flash drives, and memory cards were exempted from U.S. tariffs today), American tariffs on foreign-made vehicles – including vehicles made in Canada and Mexico, are still in effect, as are Canadian countertariffs on the non-Canadian/non-Mexican content of American-made vehicles imported into Canada from the United States.
The U.S. President has cast his tariffs as an effort to “permanently shut down the automobile manufacturing business in Canada,” adding, “Those cars can easily be made in the USA!” While the U.S. President claimed he was responding to “egregious, long time Tariffs” from Canada, it should be noted that the current trading relationship between Canada, the United States, and Mexico was formalized in the Canada-US-Mexico Agreement (CUSMA), which Donald Trump signed personally.
With an increasingly unpredictable trade and security posture from the United States likely to be the norm until at least 2029 – and potentially longer if a Trump acolyte retains the White House for the Republicans – we should not expect the pressure on our auto sector to cease, nor should we expect the U.S. to return to being the reliable security partner it once was. A further U.S. tilt away from Canada & Europe and towards Russia should be our base-case assumption, and that necessitates a response.
That response must include a national defence component.
Recalibrating Market Principles in a National Security Context
While market-driven solutions remain ideal under normal conditions, today’s security and industrial landscape calls for calibrated government intervention.
Canadian workers in the auto sector – and other impacted sectors – do not have the luxury of time. Jobs are at risk, and private investment has stalled amid macroeconomic uncertainty and geopolitical volatility. Only the government can act with the speed and scale that is necessary at this moment.
Before undertaking a direct retooling of the current civilian auto sector, there is something the federal government can do – starting immediately after the conclusion of the federal election – to protect Canadian auto sector jobs, industrial capacity, and begin rebuilding our national defence.
Scaling Defence Procurement Through Domestic Industry: The Case for Roshel
Roshel, headquartered in Brampton, Ontario, has emerged as a key supplier of armoured vehicles to Ukraine, recently delivering its 1,700th Senator. This operational scale positions it as a logical anchor for an expanded domestic defence procurement strategy. A government order for 10,000 units to be delivered within two years, valued at an estimated $10–12 billion, would necessitate a significant ramp-up in production, requiring additional facilities and a likely tripling of its 500-strong workforce. With appropriate performance-based contracts and retraining subsidies, this investment could serve as a stabilizer for displaced auto workers while advancing Canadian defence readiness.
A two-year timeline would likely be an unreasonable ask, given the time needed to expand production and train employees, but the whole point is to get the hiring and investment underway as soon as possible, in order to stimulate domestic production and protect Canadian auto worker jobs, all while strengthening our national defence.
This proposal constitutes a legitimate capacity-building strategy. The Roshel Senator is an effective and agile platform that can be equipped with a wide range of add-ons, making it ideal for a battlefield in which protection against drones, maneuverability, and flexibility are paramount.
Such a significant investment would also serve as a potent demand-side stimulus and would help build domestic industrial capability, enhancing our national resilience and sovereignty.
A Targeted Investment to Anchor Resilience and Sovereignty
As allies like Poland, Germany, and South Korea pursue similar dual-track reindustrialisation strategies, combining military procurement with civilian manufacturing transition, Canada must not lag in reinforcing its strategic base.
A large-scale investment in Roshel will not fully mitigate the potential damage to the Canadian auto sector from U.S. tariffs. It will not save every job, nor will it fully preserve our industrial capacity. But it is a step in the right direction. It’s something we can do quickly, and it’s something we can control. Investing in Roshel would make Canada more secure, would protect some auto sector jobs that would otherwise be lost, would create spin-off jobs and investments in the broader Canadian manufacturing sector, and would reduce our economic dependence on the United States, even if just to a small degree. It would also make a larger-scale transition from domestic to military production more feasible in the medium to short term.
While not a panacea, this would represent a meaningful first step toward national reindustrialisation and strategic autonomy.
Spencer Fernando
Photo – YouTube
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