Linamar's Hasenfratz: Growing automation is putting pressure on wages
The chief executive of Canadian manufacturer Linamar Corp. (LNR.TO) said the federal government is in a "tricky situation" when it comes to the U.S.-China trade war, as the intensifying feud is impacting Canadian farmers.
"The U.S. is our biggest trading partner, but there's all this great opportunity with China and it's tough to balance the two," Linda Hasenfratz told BNN Bloomberg Friday.
While she said she doesn't feel Linamar’s business overseas has suffered, her bigger worry is the economic impact of the U.S.-China trade war and the knock-on effect that's rippling through Canada.
"[It's] really primarily affecting the agricultural market because the tariffs are costing the farmers a lot of money, primarily on the soybean side in the U.S. and canola even more so in Canada," she said.
"It has nothing to do with the cycle, which is good news, because we've just been through a trough in the [agricultural] market. There's a lot of pent-up demand there – the only reason farmers aren't buying is because of tariffs. So as soon as we can get that situation put behind us, we will – in my opinion – see a surge in that market."
Tensions between the world's two biggest economies boiled over again this past week, after China responded to a fresh threat of U.S. tariffs by allowing the yuan to devalue.
The move prompted U.S. President Donald Trump to label the country a currency manipulator.
Hasenfratz added that she believes all countries have something to gain if the trade battle is resolved.
"I mean, China doesn't want to be in this situation. I'm sure the U.S. isn't loving the economic fallout of all the costs of tariffs that are being put on the shoulders of American companies and inhibiting their ability to grow and invest in the future. And that's going to have a long-term knock on effect. And of course Canada is suffering as well,” she said."To me, when everyone is hurting, there's an opportunity to come together and find a solution ... I'm hopeful we'll see the countries continuing discussions and we can get past this juncture."