Canada’s escalating trade dispute with the United States is forcing businesses to rethink cross-border supply chains, but it has not changed Amazon’s expectations for one of its fastest-growing markets.
Internal company documents reviewed by Business Insider show that Amazon expects package volume in Canada to increase by more than 40% between 2026 and 2029. The company’s forecasts have Canadian package growth outpacing the United States each year during that period, giving Amazon a strong incentive to continue expanding its Canadian operations despite new tariffs and economic uncertainty.
Amazon’s plans include additional fulfillment capacity, faster same-day delivery and changes to its logistics network. The company was still developing those plans in late July, after the United States announced another 50% tariff on certain Canadian imports.
The trade dispute is already influencing how Amazon operates. A March planning document showed that the company had shifted some direct-import sourcing for Canada away from the United States and toward China to avoid tariffs. Canada’s retaliatory tariffs, which took effect September 8, create another complication for products moving north across the border.
For Amazon, however, tariffs may not be the biggest threat to its Canadian ambitions. Competition is.
Walmart, Loblaw and Best Buy have invested heavily in faster fulfillment, using their existing networks of stores and other facilities to get online orders to customers more quickly. Amazon’s internal documents reportedly identified delivery speed as a competitive challenge in Canada, particularly as rivals increase the number of households they can reach within a matter of hours.
Amazon has been responding by expanding its own same-day options. Earlier this year, it added additional afternoon same-day delivery windows in Calgary, Edmonton and Southwestern Ontario, building on faster delivery services already available in markets including Toronto, Ottawa and Hamilton.
The company is not simply building delivery stations everywhere it sees growth. Internal projections have led Amazon to reconsider some planned facilities that did not offer attractive enough returns. Third-party delivery partners can be more cost-effective in parts of Canada, allowing Amazon to expand its reach without owning every piece of the network itself.
That approach reflects the unusual economics of serving Canada. The country offers a large and increasingly active e-commerce market, but its population is spread across an enormous geographic area. Delivering quickly to dense neighbourhoods in Toronto or Vancouver presents a very different challenge from serving smaller communities hundreds of kilometres from a major fulfillment centre.
Amazon already has a substantial base from which to grow. The company says it has invested more than C$65 billion in its Canadian operations since 2010 and employs more than 46,000 people across nearly 70 operations sites.
The next phase of that investment could intensify competition throughout Canadian retail. Faster Amazon delivery puts pressure on established retailers to improve their own e-commerce operations, while those companies can use their physical stores to offer pickup and rapid local delivery in ways Amazon cannot always replicate.
Tariffs add another variable to that contest. Retailers that can source products domestically or avoid affected cross-border supply chains may gain an advantage when trade costs rise.
Amazon’s response so far suggests it believes the Canadian opportunity outweighs those risks. Rather than retreating as the trade relationship deteriorates, the company is adapting its sourcing and delivery strategy around the disruption.
A projected 40% increase in packages over three years is a sizeable bet that Canadians will keep buying more online. The fight now is over who can get those purchases to their doors fastest and most efficiently.
