BRP Shares Plunge 20% as New US Tariffs Force Suspension of 2027 Guidance

The stock price of BRP Inc. took a hard hit Wednesday, sliding 20% after the powersports manufacturer pulled its fiscal 2027 guidance. The reason? A sharp change in US tariff policy on key imports.

Effective April 6, 2026, the US replaced the previous tariff model which taxed just the metal content with a blanket 25% tariff on the full value of imported snowmobiles and most off-road vehicles. Prior to this, tariffs targeted steel, aluminum, and copper content at 50%. This new approach is expected to hike BRP's costs by more than half a billion dollars through the rest of the year.

BRP's CEO Denis Le Vot highlighted the unpredictable nature of current tariff conditions impacting the manufacturing sector. Despite the challenges, he emphasized the company's strong balance sheet and early-year momentum as tools to weather the impact.

This shifts the cost landscape dramatically for BRP, which relies heavily on importing vehicles into the US market. The recalibrated tariff based on total product price significantly outweighs the former method tied to metal portions, squeezing margins.

With this uncertainty, BRP has stepped back from providing any firm outlook for fiscal 2027, awaiting further clarity on the tariff environment and potential countermeasures.

Investors reacted swiftly, pushing shares down sharply as the market digested the hefty financial hit tied to the tariff revisions. The suspension of guidance adds to the cloudiness around near-term performance expectations.

This development underlines how trade policies can quickly upend operational economics for manufacturers with substantial exposure to cross-border supply chains, especially in sectors like powersports.

It'll be interesting to see how BRP navigates this new terrain and whether other manufacturers in similar boats will face parallel challenges as tariff regulations continue to evolve.