Canada-Ontario Tariff Plan: C$8.7bn for Steel, Autos and the Ring of Fire

Prime Minister Mark Carney and Ontario Premier Doug Ford have announced an C$8.7 billion action plan to support Ontario’s steel, automotive and critical minerals industries in the face of US tariffs. Unveiled on Wednesday, 21 October 2026, the joint federal-provincial package includes a new steel fund, fresh capital for car plants and matched funding for roads into the mineral-rich Ring of Fire region of northern Ontario.

Carney said the investments would help protect up to 290,000 jobs across the province, CBC News reported. “From mine to mill to assembly line, Canada and Ontario are protecting jobs today and making bold investments that will build a stronger, more resilient, more independent Canadian economy for tomorrow,” he said in a statement from the Prime Minister’s Office.

What Is in the Canada-Ontario Tariff Plan?

According to the Prime Minister’s Office, the package has three main parts: steel, autos and critical minerals. All figures below are in Canadian dollars.

• Joint Steel Action Fund: C$3.55 billion from Ottawa and C$1.67 billion from Ontario over five years, to diversify production, supply sectors such as defence and energy, and open overseas markets.
• Automotive capital projects: C$2.5 billion over two years (C$1.5 billion federal, C$1 billion Ontario) for modern machinery and upgraded production lines for connected and electric vehicles.
• Ring of Fire roads: Ottawa will match Ontario’s initial investment of up to C$1 billion over three years for road infrastructure.
• Task forces: new Canada-Ontario steel and automotive task forces.
• Trade protection: tougher enforcement against steel dumping and unfair subsidies by the Canada Border Services Agency.

Who Can Access the Funding?

The announcement sets out the size and purpose of the funds, but detailed application rules for companies have not yet been published. The steel fund is aimed at Canadian steel firms preparing to supply growing domestic industries and new export markets, while the automotive money is for manufacturers investing in machinery and production lines, according to the government.

For smaller businesses already hit by tariffs, Ottawa pointed to existing support. In August 2026, it announced C$7.5 billion in new and enhanced measures, including C$1.5 billion through the Regional Tariff Response Initiative for small and medium-sized enterprises, a C$500 million liquidity stream under the Business Development Bank of Canada’s Pivot to Grow programme, and a C$2 billion Canada Strong Diversification Fund. The government says it has provided more than C$25 billion in support to workers and businesses affected by US tariffs.

What Changes for Vehicle Emissions Rules?

As part of the plan, Canada will keep its greenhouse gas emissions standards for new light-duty vehicles at 2026 levels through the 2029 model year, with annual increases resuming from the 2030 model year. Brian Kingston, president of the Canadian Vehicle Manufacturers’ Association, told CBC the move would provide “some relief”. Evan Pivnick of Clean Energy Canada said it was a setback for the government’s electric vehicle sales targets.

Why Now?

The package comes amid a prolonged trade dispute with Washington. In August, US President Donald Trump threatened to raise tariffs on all cars, trucks, auto parts and steel to 50% on 1 January, after Carney announced matching dollar-for-dollar counter-tariffs, CBC reported. The US already applies 25% levies to finished vehicles and to auto parts that do not comply with the Canada-United States-Mexico Agreement (CUSMA).

“An integrated North American auto sector will be stronger, more competitive and provide better jobs for our workers,” Carney said. “But we recognize these are not the objectives of the current U.S. administration. Their approach has changed, and so must ours.” Ford called the agreement “the next step in our ongoing partnership to provide tariff-impacted workers the certainty and stability they deserve”.

How Big Are the Industries at Stake?

According to the government, Canada’s automotive sector supports more than 120,000 direct jobs and contributes more than C$16 billion a year to GDP, while the steel industry supports more than 23,000 direct jobs and is integral to 172,000 jobs in fabricated metals. Carney said the process for opening a mine in Ontario had historically taken more than 15 years, and that the two governments would create a co-ordinated permitting process, CBC reported.

What Should Businesses Watch Next?

• Programme guidelines for the Joint Steel Action Fund and automotive capital funding.
• Task force recommendations, starting with ways to cut steel shipping costs.
• US tariff decisions before the threatened 1 January increase.
• Ring of Fire permitting and First Nations engagement through a new working group.

For more on Canada, see our report on the Alberta referendum result. For more funding news, visit our Loans & Grants News section and our Americas news page.

Featured image: Dofasco steel mill, Hamilton, Ontario, by Martin Cathrae / Wikimedia Commons, CC BY-SA 2.0. Image licensed CC BY-SA 2.0.

Sources

• Prime Minister of Canada — Prime Minister Carney and Premier Ford launch new action plan to protect workers from tariffs and strengthen Ontario industries (21 October 2026).
• CBC News — Carney, Ford announce $8.7B partnership to support steel, auto, critical mineral sectors (21 October 2026).
• Xinhua — Xinhua world news summary at 0030 GMT, Oct. 22 (22 October 2026).