A 50% jump in tariffs on Canadian aluminum is squeezing Tampa Bay manufacturers, forcing companies to eat rising material costs or pass them along to customers, industry leaders say — the latest test of how well local businesses can adapt to a shifting trade landscape.

Southern Manufacturing Technologies, a Tampa-based supplier that produces components for defense systems and commercial aircraft including Boeing 737s, Airbus jets, and K-320 planes, relies on U.S.-made rolled aluminum. But roughly 60% of the melting process needed to produce that aluminum happens in Canada, where costs have historically been far lower, according to SMT president Roy Sweatman.

“If we’re quoting a new part or a part that we’ve made before for a new purchase order, we’ll factor the cost of the material into those pricing,” Sweatman said. The company has locked in three five-year agreements at fixed prices with customers, some of which include clauses allowing a price increase if tariff costs exceed a certain threshold. Until then, SMT absorbs the difference itself.

Businesses find workarounds, as they have before

Rather than waiting on policy relief, at least one SMT customer is exploring a private-sector fix: a distributor network that would supply aluminum at pre-tariff prices, with the customer absorbing the markup directly. It’s the kind of contractual creativity manufacturers have leaned on before — Sweatman noted that companies faced comparable disruptions during the first Trump administration’s tariff rounds, though he said the current 50% rate is a steeper climb than anything they navigated then.

“We’ll get through it one way or the other,” Sweatman said. “It’s not going to be something that’s going to kill us. But it’s certainly going to affect us, and we’re going to have to do all the things we can to cut other costs to make up for it.”

That response — cutting costs, restructuring supply agreements, and adapting rather than lobbying for a bailout — reflects the kind of market resilience Tampa Bay’s manufacturing base has shown through previous rounds of trade friction, even as the higher input costs remain a real burden in the near term.

Where the costs could land

Sweatman said the ripple effects may not stop at the factory floor. Higher aluminum costs could eventually show up in airline ticket prices and in the defense budget, given aluminum’s role in missile systems and other military hardware.

“It rolls up to where it’s going to affect their ticket prices on airplanes,” Sweatman said. “It’s going to affect the defense budget because of the extra cost of the parts that go into missile systems.”

Beth Galic, president of the Bay Area Manufacturers Association, said the bigger issue for local companies isn’t necessarily the tariff rate itself but the unpredictability that comes with it.

“From our perspective, this is really about uncertainty for local manufacturers,” Galic said in a statement. “Steel and aluminum are essential inputs for so many of our local manufacturers, and when tariffs go up, those costs don’t just disappear. They can affect pricing, production decisions and ultimately our ability to compete.”

Galic said manufacturers are watching the situation closely and hoping for stability, since long-term planning depends on knowing what input costs will look like months or years out.

The bigger picture

Tariffs are often framed as tools to protect and rebuild domestic industry, and supporters argue that shielding U.S. suppliers from artificially cheap foreign material is a worthwhile trade-off in the long run. But cases like SMT’s illustrate a wrinkle in that argument: much of the “foreign” processing at issue here isn’t replacing an idle domestic option — it’s a step in the supply chain that, for now, is simply cheaper to run north of the border. Whether the tariff succeeds in shifting that processing capacity back to the U.S., or just raises costs for American manufacturers and their customers in the meantime, is likely to become clearer as the policy plays out.

For now, Tampa Bay’s manufacturers appear focused less on the politics of trade policy and more on the practical work of managing it — a reminder that in this region’s economy, adaptability tends to matter more than which administration set the rate.

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