Trump tariffs force Sea-Doo maker BRP to withdraw financial outlook

Quebec recreational-vehicle manufacturer BRP Inc. withdrew its financial outlook for the 2027 fiscal year on Tuesday, saying it faces a $500-million cost from recent changes by the Trump administration to its tariffs. 

This month, the White House simplified its tariffs on items made with steel, aluminum and copper. Certain products “substantially made” with those metals became subject to a 25-per-cent tax on their full value, rather than a 50-per-cent tax only on the metal content. 

For BRP, that comes at a huge cost. The changes mainly lead to a 25-per-cent tariff on the value of snowmobiles and many off-road vehicles when they are imported to the U.S., the company said. 

Shares of BRP were down 36 per cent to $69.13 as of 1:55 p.m. Wednesday in Toronto. 

“The magnitude of the impact is mind-blowing, but it is likely the worst-case scenario,” Stifel analyst Martin Landry said in a note to investors. “We expect BRP will likely raise prices to offset the impact. However, quantifying the impact this would have on volumes is hard to judge.”

BRP expects $500 million in additional tariff expenses for the remainder of the fiscal year, before any mitigation measures to offset it. 

“Like many manufacturers, we are operating in a highly volatile and unpredictable tariff environment that continues to create uncertainty across the market,” chief executive officer Denis Le Vot said in a statement Tuesday. 

BRP, which makes products in the U.S., Mexico, Canada, Finland and Austria, had issued an outlook less than three weeks ago calling for net income of $410 million to $480 million for the year ending Jan. 31, 2027. 

“This is a major expense headwind, one likely to impact BRP more than peers” because of its manufacturing footprint in Canada and Mexico, TD Cowen analyst Brian Morrison said in a note.

The company’s brands include Sea-Doo personal watercraft, Ski-Doo and Lynx snow vehicles and Can-Am products including off-road all-terrain vehicles.

 

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