Canadian CEO supports Trump's steel tariffs, wishes they were even higher

Barry Zekelman, the Windsor, Ont.-area owner of a North American steel tube and pipe empire, is backing U.S. President Donald Trump's proposed tariffs and offering all employees a $1,000 annual bonus while the policy is in effect.

Barry Zekelman of Windsor, Ont., offers all employees a $1,000 bonus while the tariffs are in place

Zekelman Industries CEO Barry Zekelman says he supports U.S. President Donald Trump's proposed steel tariffs and says Canada should follow his lead. (Meg Roberts/CBC)

The Windsor, Ont.-area owner of a North American steel tube and pipe empire is backing U.S. President Donald Trump's proposed tariffs and offering all employees a $1,000 annual bonus while the policy is in effect.

Barry Zekelman said Trump's talk about a 25 per cent tariff for steel and 10 per cent for aluminum provides an example the Canadian government should follow, with one addition.

"Is that 25 per cent duty enough? I don't think it is and I actually think those duties should be much higher," he said.

Canada has been seeking an exemption to the threat of taxes Trump announced last week. On Monday, the president said he would only exempt Canada if a new "fair" North American Free Trade Agreement is signed.

Excluding any one country from Trump's steel and aluminum tariffs will create a slippery slope, a White House trade official said. (Chris Helgren/Reuters)

Zekelman has 15 manufacturing locations on both sides of the border, with the bulk in the U.S. and one in Harrow, Ont. 

Following Trump's tariffs announcement, Zekelman issued a news release, including a letter sent to the company's 2,300 employees, celebrating the president's move and vowing "WE WILL WIN IN A FAIR FIGHT." 

"I am pleased to announce a one thousand-dollar ($1,000) bonus for each of you as a direct result of policy changes announced by President Trump," he wrote. "This bonus will be paid as soon as the announced changes go into effect and will be paid annually so long as the policies remain in effect."

'Dirty Dozen' are depressing steel prices

Zekelman said illegal steel dumping from 12 countries he refers to as the Dirty Dozen has "artificially depressed" steel prices in North America for decades.

The metal enters the continent in a variety of ways, but the CEO said China has been especially successful at circumventing existing tariffs by shipping their steel in as mailboxes, lockers and other products for which suppliers don't have to pay duties.

Zekelman Industries CEO Barry Zekelman explains why Canada and the U.S. need to stop steel dumping from other countries. 0:26

"They have extensive ways to cheat our system and we need to stop being so nice about it and we need to hold them accountable."

Zekelman said he believes Trump's tariff threat includes Canada because it's easier to make a "blanket move" and deal with exceptions after the fact.

"President Trump doesn't view Canada as an enemy."

Zekelman also believes Trump is using the tariffs as a strategy in the ongoing NAFTA talks.

"I do firmly believe that eventually this will get worked out with Canada. I believe President Trump is a businessman, he's not used to being a politician, he wants things to move much quicker," Zekelman said. "In doing that he will use leverage in any way possible to get a proper deal done. Even if that means dragging [in] Canada."

'There will be job losses'

Not everyone in Windsor-Essex views the tariff talk in such a positive way.

RJ Steel Company president Ryan Jordan said his costs have already gone up.

This steel company presidents says a 25% tariff would hurt Windsor's workers/ 0:23

"I've been warned to start preparing quotes to absorb the rising costs of steel," he said. "It hasn't stopped. It seems every month I call the prices go up."

I think [Trump's] whole trade war thing is stupid. He's just going to hurt his own country, let alone others.- David Harrison, Chrysler Assembly Plant

Jordan said if prices continue to rise, he would have no choice but to raise his prices too, and he hopes all the trade talk will turn out to be just that — talk. But if Trump makes good on his 25 per cent tariff threat, the impact at RJ Steel would be serious, he said.

"We will be in trouble. We'll have to find some other product to manufacture, something that can incorporate other materials, other metals. From a smaller manufacturer like myself, to Chrysler, if the tariffs are that severe, I believe there will be job losses."

Employees stopped outside the Chrysler Assembly Plant in Windsor said they were worried about the tariffs.

Daniel Campbell said if costs rise, he fears Fiat Chrysler Automobiles could move production to another country.

Windsor assembly plant worker David Harrison says steel tariffs could hurt the U.S. and Canada. (Melissa Nakhavoly/CBC)

David Harrison said he can't understand how creating duties will benefit either country.

"It's going to increase prices on a lot of thing," he added. "I think [Trump's] whole trade war thing is stupid. He's just going to hurt his own country, let alone others."

Canada 'not the guilty party'

Zekelman said he was invited to the White House last week when the president was set to announce the tariffs.

The CEO was out of the country at the time, but said if he's invited again this week, he would gladly sit with Trump at the table.

"I'm trying to balance this and walk a fine line. I will tell you that absolutely in no way is Canada a contributing factor to any hardships in the U.S. steel industry," he explained. "I'm using every tool I have to hopefully get Canada excluded or exempted from this action because really we're not the guilty party."

With files from Katie Simpson, Meg Roberts, Melissa Nakhavoly