Tariffs are often presented as instruments that raise prices at the border. This paper offers a different perspective. It examines a fictional but representative small- to mid-size Canadian manufacturing firm that produces aluminum ladders and exports most of its output to the United States. As Section 232 tariffs and Canadian retaliatory measures take effect, the firm faces a set of difficult and consequential decisions that extend well beyond pricing. Efforts to remain competitive require changes to sourcing strategies, manufacturing sequences, and potentially the location of production itself, with direct implications for employment, investment, and community stability. Drawing on a detailed numerical case study in Appendix A, the paper shows that modern tariffs function less as predictable charges and more as forces that reshape firm behavior and economic outcomes deep within the production process.
Miha Saluja (2026) studied this question.