How Canada’s retaliatory tariffs could drive up your winter heating costs

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Its U.S. counterpart, Heating, Air-conditioning, and Refrigeration Distributors International (HARDI), alongside the Air Conditioning Contractors of America, the Air-Conditioning, Heating, and Refrigeration Institute, and the Plumbing-Heating-Cooling Contractors Association, wrote a similar message to U.S. Trade Representative Jamieson Greer in early September. They wrote to “express our strong support for the United States-Mexico-Canada Agreement (USMCA) and urge the Office of the United States Trade Representative to protect the agreement’s benefits to the heating, ventilation, air conditioning, refrigeration, and water heating (HVACR) industry.”

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Martin Luymes, VP of government and stakeholder relations at HRAI, which represents roughly 1,200 member companies nationwide, says the industry’s concerns are more urgent now that the tariff exposure has expanded. In 2025, in response to the 232 tariffs, Canada responded with a retaliatory set of tariffs that impacted U.S.-origin gas furnaces coming north. This led Canada’s industry to campaign for tariff relief, which was granted in June, Luymes explained.

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But now, following the introduction of Washington’s Section 338 tariffs on hundreds of Canadian imports this August, Ottawa has imposed new retaliatory tariffs that are raising the prices on HVACR equipment and components being shipped into Canada — and now the impact is close to universal.

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“Air conditioning products, heat pumps, and a variety of others are included, including refrigeration components, parts … and are all within scope of different levels of tariffs, anywhere from 15 to 25 to 50 per cent,” Luymes explained.

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Because Canada imports more HVACR equipment from the U.S. than it exports, Luymes said Ottawa’s retaliatory tariffs are hitting Canada’s side harder than the original U.S. tariffs.

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“The impacts on the Canadian economy, in our sector at least, are greater — are more driven by the Canadian response than by the original U.S. tariffs,” he said.

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That’s why Hyman and others want the retaliatory tariffs, at least on HVACR products, lifted.

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“As much as we would like to stand up to U.S. trade aggression, we shouldn’t do it despite ourselves,” Hyman said.

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Without a policy change, he anticipates sticker shock for customers this winter. “If your furnace dies this winter, you need to replace it this winter. You can’t wait a couple of years to replace it,” he said.

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In the U.S., Alex Ayers, HARDI’s VP of government affairs, also sees the tariffs and price increases as unfair to consumers, especially given that heating and cooling are essential goods.

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“Tariffs increasing the cost of products that are very necessary — whether it is heating in winter, air conditioning in summer … and then very specifically refrigeration … have a dramatic impact on people’s lives,” he said.

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A return to CUSMA free trade, meanwhile, would restore much-needed certainty the industry has been lacking, he said.

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“We as an industry view USMCA as successful. We want to continue to see it be successful,” Ayers said.

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The goal of Trump’s tariffs was to foster more domestic manufacturing, but they have not succeeded in expanding U.S. domestic HVAC production, and the supply chain issues and higher costs have simply added more uncertainty.

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Ayers noted that the fluctuating tariffs are wreaking havoc on operations.