Why your city is still waiting on e-buses — and how tariffs could make things worse

Electric bus manufacturers hit hard by pandemic-era supply chain chaos could soon find themselves pummelled by a trade war. 

"The immediate effect of the [U.S. President] Donald Trump tariffs is buses become more expensive overnight," said Josipa Petrunic, the president and CEO of the Canadian Urban Transit Research and Innovation Consortium (CUTRIC).

Petrunic said the highly integrated North American industry could see companies hike prices, leaving cash-strapped Canadian transit agencies with a big problem. 

"All of a sudden a city that has only so much money can buy many fewer buses from what it planned," she said. 

Cities across Canada are already making difficult choices in the face of intolerably long manufacturing waits, including buying more diesel buses instead. 

Manufacturers worry outdated payment models and incredible levels of customization have forced them into a corner, which Petrunic arguing the industry has brought to the point of an "existential crisis."

On a November earnings call for NFI Group, owner of one of two main Canadian e-bus manufacturers, CEO Paul Soubry said he wished he had a "crystal ball" — presumably aimed at Trump's Oval Office. 

"We're basically concerned, obviously, but not disastrously worried that there's going to be a massive impact," he said.  

Any effect would be felt north of the border. 

"We don't export a lot out of the U.S., other than in some cases, we'll build some parts that send to Canada," he explained. "The other end, where we build something in Canada, a shell, most of it is used with U.S. steel or U.S. components."

Petrunic predicts a double whammy. 

North American integration means that companies would be hit by tariffs on parts that head north to their Canadian factories and then again on completed vehicles sent to American customers. 

NFI owns New Flyer. For the other major manufacturer Nova Bus, which closed its U.S. factory in 2023, Petrunic said the risk could be greater. 

Before the pandemic, the burgeoning industry was dealing well with the massive influx of orders from Canadian and American cities, taking advantage of major financial incentives provided by higher levels of government.