The reintroduction of Trump tariffs in early 2025 has sent ripples across North American industries, with Canadian airlines in the fallout.
These tariffs, including a 25% levy on most Canadian imports to the U.S. and 10% on energy, have triggered a significant scaling back of U.S. operations by Canadian carriers.
This shift stems from a mix of economic pressures, retaliatory Canadian tariffs, and a sharp decline in transborder travel demand. Here’s how the Trump tariffs are currently reshaping the transborder aviation landscape.
Pulling the Tariff Trigger
The trade tariffs, effective March 4, 2025, mark a return to protectionist policies instituted by President Donald Trump.
Aimed at bolstering U.S. manufacturing, they’ve instead sparked a trade war. Canada responded with 25% tariffs on $30 billion of U.S. goods. The northern neighbor signaled plans to escalate to $155 billion if the U.S. doesn’t relent.
This tit-for-tat between the two nations has hit airlines hard. With a weakened Canadian dollar and rising costs, travel to the U.S. has become less appealing for Canadians.
Data showed a 40% drop in leisure bookings to U.S. cities in February 2025 and a staggering 70% decline in flight bookings for April through October 2025 compared to last year.
Air Canada’s Response
Air Canada, the Canadian national carrier, has slashed U.S. operations. Starting March 2025, it reduced flights to leisure hotspots like Florida, Las Vegas, and Arizona.
A notable swing to a focus on UK and European routes has been evident in recent weeks.
Frequency cuts, smaller aircraft, and outright cancellations, like the Vancouver to Washington Dulles route, reflect this pivot.
The airline is redirecting resources to domestic and non-U.S. international routes where demand remains steady. The Trump tariffs have made U.S. travel less profitable, pushing Air Canada to adapt quickly.
Low-Cost Carriers and Others Follow Suit
Flair Airlines, a budget carrier, has also pulled back. Routes to Nashville are gone, and services from Calgary and Edmonton to Las Vegas will end by April 2025.
WestJet, another key player, canceled planned routes like Calgary to LaGuardia and trimmed other U.S. services. Even U.S.-based United Airlines, partnered with Air Canada, has cut frequencies on routes like Los Angeles to Toronto.
The Trump tariffs have created a domino effect, reducing transborder capacity right across the board.
Growing Anti-US Sentiment
Beyond tariffs, anti-U.S. sentiment in Canada has grown. Social media campaigns urging Canadians to “buy local” and avoid U.S. travel have gained traction.
Coupled with higher ticket prices due to tariffs and currency fluctuations, demand has cratered.
Airlines, facing empty seats, have no choice but to scale back. The Trump tariffs have acted as a catalyst for broader economic and behavioral shifts.
Coupled with this has been the rising concern of “border hostility” with Canada issuing a US travel advisory this week. The advisory warns travelers to the US of border agents’ ability to check electronic devices without a warrant.
Looking Ahead
The situation remains fluid. Some Trump tariffs were delayed, offering a brief reprieve. Yet, with Canada’s retaliatory measures in full swing, the outlook for U.S.-Canada air travel is grim.
Canadian airlines are bracing for a prolonged trade standoff, reallocating planes to sunnier markets like the Caribbean or Europe.
For now, the Trump tariffs have grounded flights, and effectively clipped the wings of a once-thriving cross-border relationship.
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