Voyageur 84
Ski-Doo's Maker Lost a Third of Its Value in a Day, and The Canadian Housing Recovery That Isn't.
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Ski-Doo's Maker Lost a Third of Its Value in a Day
BRP (once upon a time known as Bombardier Recreational Products), the Quebec company behind Ski-Doo snowmobiles and Can-Am off-road vehicles, lost more than a third of its market value on Wednesday after revealing that US tariff changes will cost it $500 million this year.
BRP makes about 70% of its products in Mexico and most of the rest in Valcourt, Quebec, but sells 60% of its stuff into the US. When the Trump admin changed its Section 232 rules on April 6 - slapping a 25% levy on the full value of any product substantially made of steel, aluminum, or copper - BRP's tariff bill went from $90 million to half a billion overnight. That's about 60% of the company's annual earnings, evaporated.
BRP has yanked its financial forecast entirely. Competitors like Polaris, which builds its snowmobiles in the US, are in better shape. National Bank analyst Cameron Doerksen said the change "fundamentally changes the profitability profile" of the company.
Ski-Doo has been rolling off the line in Valcourt since 1959. Whether it still will be in five years is a genuine question.
Read more: BNN Bloomberg / The Globe and Mail
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The Canadian Housing Recovery That Isn't
CREA downgraded its housing forecast on Thursday, putting the blame squarely on oil. The crude price spike from the Iran standoff (Voyageur 81) has raised fears of inflation, pushed bond yields higher, and has driven fixed mortgage rates back up. First-time buyers who had been waiting for rate relief got the opposite.
National average home prices are expected to barely move this year, rising only about 1.5% to $688,955. B.C., Alberta, and Ontario are expected to see virtually no growth at all. March prices were down 0.8% compared to a year ago, and the MLS Home Price Index has dropped for 16 straight months.
"We've had to change [the forecast] and lower it because of the situation in the Middle East and the oil shock," said CREA senior economist Shaun Cathcart.
The 2027 outlook isn't expected to be much rosier. Prices are expected to inch up 0.9% to $695,094, which is below the rate of inflation. Sixteen months of consecutive drops, and an average home still runs $688,955.
Read more: Canadian Real Estate Association / The Canadian Press