Good afternoon, everyone.
Thank you for this opportunity.
I represent a manufacturing SME in the Joliette region. We've been in business for more than 50 years. We make specialized, custom-designed equipment using industrial steel. Over the years, we've built strong business relationships with large U.S. customers. More than 60% to 70% of our sales are in the U.S.
As you know, prior to April 8, section 232 of the Trade Expansion Act only applied to certain products, mostly structural products. For us, that represented only 5% of our sales, so most of our products were not affected. As you know, a 50% tariff was applied to non-U.S. steel content. For us, that represented about 5% to 8% of the value of a project once applied.
Since April 8, the situation has completely changed. Now, a 25% tariff is applied to the total value of the commercial bill for virtually all steel products. For our company, it's a direct increase of 25% of our export price, and we're unable to absorb that increase. We can't reduce our selling prices by 25%, so we're really losing our competitiveness in the U.S. market.
What I understood is that there may be some exceptions for certain products. There might be a 15% tariff until 2027 on certain products, but that's not very clear to me. There could also be a tariff of only 10% if 95% of our steel was American. It's almost impossible for our company to source exclusively American steel, especially for plate, which comes almost exclusively from Canada, not to mention that American steel is very expensive compared to Canadian products. That has a major impact on our business.
For the past year, we've been trying to build relationships with new customers in new markets. However, we're subcontractors for components manufacturers. We manufacture what our customers want, and that's custom-made equipment. It's a local market. It's difficult for us to export outside North America. Also, the Canadian market is still more limited than the American market. It's still hard to do without sales to the U.S.
Since tariffs were announced a year ago, we've been working hard to try to improve our productivity, but the 25% tariffs are having a major impact, mainly because they were applied quickly.
Thanks to Economic Development Canada, we've been able to invest. Through the regional tariff response initiative launched last fall, we purchased a machine to improve our productivity. We invested $1.3 million in new digital equipment. However, the equipment has yet to be set up. That'll be done in the coming months. Since the productivity gain isn't immediate either, we wonder if we'll be able to make that investment profitable in the current context.
In the short term, the most important thing for our business is really to maintain our cash flow and our workforce. Obviously, we have highly skilled employees, but it's hard to replace them. Almost 30% of our workforce is made up of temporary workers, and they're essential to our business. If we lose them, we may not be able to continue our operations.
We definitely need an employment support program to keep our workers and maintain our cash flow. Quick and accessible support for market development should also be accessible, because it's costly for our business.
Also, we have to work constantly with tariff experts to stay informed and get support, and that's an extremely high expense for our business, from $100 an hour to $200 an hour. It's important for us to have access to help to better understand the rules and adapt. Flexibility is needed in order to keep our temporary foreign workers.
That's what I wanted to say in the five minutes I was given.