Canadians in the market for new cars are increasingly leaning towards locally built vehicles, according to KPMG Canada’s “2025 KPMG Consumer Automotive Survey.”
With 61 percent of Canadians looking to buy in the next five years, US tariff-related disruptions have sparked concerns about inflation. Seventy-six percent of respondents are worried that trade tensions and tariffs could render new vehicles unaffordable. Twenty-three percent expressed concern that they have been priced out, and an additional 10-15 percent price hike would price out 38 percent more of respondents.
Affordability remains a key consideration for new car buyers, with 80 percent citing price as the important factor in their purchasing decisions. With the Canada–U.S.– Mexico Agreement up for review this year, 72 percent of respondents reported their concern that vehicle prices would soar without the agreement’s protection.
Seventy-one percent said brand trust and reputation were their main consideration.
“Car buyers are looking for vehicles that meet their lifestyle, are affordable and have a positive economic impact on the country. It’s not surprising that Toyota and Honda, which each have a large manufacturing presence in Ontario, resonate most with Canadian consumers,” said Dave Power, KPMG in Canada’s partner and national automotive sector leader, in a statement. “At the same time, trust in the Detroit 3 is starting to erode as Canadians see a lack of commitment to keep jobs in Canada, driven by U.S. trade policies and pressures on company leadership to move operations to the U.S.”
He added that Canadians sought a new automotive industry strategy that “prioritizes domestic manufacturing, secures jobs, provides long-term resilience, and positions Canada as a leader in electric vehicles and battery production.” Seventy-two percent of survey respondents found it important that their vehicles were built or assembled in Canada.
“If the CUSMA rules of origin change substantially to require even more North American content, this could have a dramatic impact on existing automotive supply chains. This disruption would require a search for new North American suppliers to replace overseas manufacturing. While disruptive and likely to increase costs, this change could also create opportunities for Canadian manufacturers to expand and diversify their business,” said Joy Nott, trade and customs partner, in a statement.
Just 7 percent of respondents wanted government subsidies to go to the Detroit 3; 37 percent called for funding to be focused on Canada’s auto parts supply industry, protecting local manufacturing and supply chain stability. Sixty percent also urged governments to support automakers operating in Canada financially and to offer incentives.
Electric vehicles could also help Canada limit its reliance on the U.S. automotive industry. Power noted that billions had been earmarked for new battery and EV charging facilities in Ontario and Quebec, with a made-in-Canada ecosystem for cleantech exports in renewable energy, EVs, and electrification in the pipeline.
“We have everything to lead the EV transition, including critical minerals, innovation, talent, and manufacturing capacity. What’s needed is a clear roadmap to accelerate Canada’s leadership, bearing in mind that building affordable EVs will be essential, particularly to compete with lower-cost models from foreign manufacturers, as will significant investment in a robust charging infrastructure,” Power said.
Fifty-five percent of respondents indicated that they intended for their next cars to be environmentally friendly, with 33 percent considering hybrid cars, 11 percent considering plug-in hybrids, and another 11 percent looking into fully electric.
Power explained that Canadians wanted “long-term strategy, not short-term patches.”
“Canadians are calling for strategic investments that safeguard manufacturing jobs while strengthening the foundation for the entire automotive ecosystem,” he said.
The “2025 KPMG Consumer Automotive Survey” obtained responses from November 7-17, 2025.