More than half of Canadians expect to be in the market for a new vehicle within five years, but many fear U.S. tariffs will push prices beyond what they can afford, according to a new survey by KPMG.
It found 72 per cent of Canadians are concerned new vehicle prices will rise if Canada’s auto industry loses protection under the Canada–U.S.–Mexico Agreement, with trade uncertainty remaining high ahead of a scheduled review of the pact.
Nearly a quarter of respondents (23 per cent) fear tariffs have already priced them out of the new vehicle market, while another 38 per cent say a further 10 to 15 per cent increase in prices would do the same.
Amid concerns about tariffs, more Canadians are focusing on where their vehicles are made, with respondents saying it is at least somewhat important to them that vehicles are assembled in Canada.
The Canadian government is expected to begin formal discussions with the United States in January as part of a scheduled review of the current free trade agreement, raising uncertainty for an auto sector that relies heavily on cross-border supply chains.
Future tariff decisions weigh heavily on the outlook for Canada’s auto sector. Linamar executive chair Linda Hasenfratz previously warned Ottawa to defend the CUSMA trade pact, saying any move to impose tariffs on auto parts could “bring the industry to its knees.”
“With U.S. tariffs disrupting the industry, Canadians in the market for a new vehicle are looking to the brands they trust at prices they can afford in models they want, and increasingly, on where those vehicles are built,” said Dave Power, partner and national automotive sector leader, KPMG in Canada.
“It’s not surprising that Toyota and Honda, which have a large manufacturing presence in Ontario, resonate most with Canadian consumers,” he added. “At the same time, trust in the Detroit Three is starting to erode as Canadians see a lack of commitment to keep jobs in Canada, driven by U.S. trade policies and pressures on company leadership to move operations to the U.S.”
According to KPMG, Canadians broadly support reducing reliance on the U.S. while shifting investment towards defence, auto parts, battery and critical minerals manufacturing.
The report also points to electric vehicles as a potential growth opportunity, with about half of Canadians (52 per cent) saying governments should make EV leadership a priority.
“With all the turmoil in the auto sector, Canada has a real opportunity to invest at home and diversify into EV battery production to protect jobs, attract investment, and build long-term resilience,” Power said.
KPMG in Canada surveyed 2,000 Canadians between the ages of 18 and 85 from Nov. 7 to Nov. 17, 2025, using Sago’s AskingCanadians panel and its Methodify online research platform.