Ontario will ban American companies from provincial contracts and cancel its $100 million contract with Elon Musk’s Starlink in response to the United States (US) enacting tariffs on Canadian energy and goods, Premier Doug Ford announced this morning.
Starlink is the satellite internet constellation subsidiary of Musk’s SpaceX, which provides internet access through thousands of low-Earth-orbit (LEO) satellites. The province inked the contract with Starlink this past November to provide 15,000 homes and businesses in rural, remote, northern communities with high-speed internet access by June 2025.
Following publication, Prime Minister Justin Trudeau announced that US tariffs on Canada would be paused for at least 30 days. Ford said that the province will also pause its “retaliatory measures” in response.
“Make no mistake, Canada and Ontario continue to stare down the threat of tariffs,” Ford said.
“Ontario won’t do business with people hellbent on destroying our economy.”
Musk has become an integral part of the new White House, heading the so-called “Department of Government Efficiency” that has gutted American agencies such as the US Agency for International Development and gained access to the Treasury Department’s payments system.
Musk’s proximity to the White House has opened up calls to target his businesses directly as part of the burgeoning trade war between Canada and the US, including Liberal leadership candidate Chrystia Freeland proposing direct tariffs on Tesla electric vehicles. With the cancellation of the Starlink contract, Ford is following suit.
“Ontario won’t do business with people hellbent on destroying our economy,” Ford said. “Canada didn’t start this fight with the U.S., but you better believe we’re ready to win it.”
Additionally, Ford claimed that the provincial government and its agencies spend $30 billion on procurement every year, meaning US-based businesses will lose out on tens of billions of dollars in new revenues.
As Ford declared his province would cease working with Starlink, Québec Premier François Legault said he did not plan to cancel its existing contract with SpaceX to supply Starlink terminals to remote regions. The Montreal Gazette reported that a new government contract to install Starlink in Québec courthouses is still in the works.
On Feb. 1, US President Donald Trump signed an executive order to implement 25-percent tariffs on virtually all Canadian goods and 10-percent tariffs on Canadian energy starting Tuesday. In response, the Canadian government imposed 25-percent tariffs on $155 billion of American goods, with tariffs on the first $30 billion taking effect on Tuesday and the rest to follow after a 21-day public comment period. The Canadian government is also considering its own non-tariff measures, which could similarly target Canada’s procurement of American contracts.
Ontario’s Starlink contract has garnered criticism since its inception, including from Nickel Belt MPP France Gélinas, who called the deal a “donation-investment” after it was signed. The contract covered the cost of equipment and installation fees, as well as an agreement of guaranteed service, for the cost of $6,677 per recipient, while a standard Starlink installation kit is $500 at retailers such as Costco. Ontario Liberal leader Bonnie Crombie called on Ford to rip up the “sweetheart deal” on Jan. 22 as tariff threats were heating up.
“Why did Doug cozy up to Elon in the first place?” Crombie said in a statement. “This is a destructive man child who proudly styles his leadership after a dictator, and is championing the 25% tariff on Canada.”
This isn’t the first time Musk’s Starlink has been in the crosshairs of Canadian procurement conversations. In September 2024, Ottawa-based satellite company Telesat secured a $2.14-billion CAD loan from the Canadian government and a $400 million loan from the Québec government to complete a competing LEO high-speed satellite internet network.
The price tag sparked discussion online with some, including Conservative MP Michael Barrett, criticizing the move, suggesting that funding to bring internet to Canada’s rural areas could have been given to Elon Musk’s Starlink instead. Musk chimed into the conversation, claiming in an X post that it would take Starlink “less than half that amount” to bring high-speed internet to Canadian households.
“We won’t outsource our national security & we’ll have the network to protect Canada and the Arctic,” Minister of Innovation, Science and Industry François-Philippe Champagne said in an X post at the time.
UPDATE (02/04/2024): This story has been updated to note that Ontario’s retaliatory measures have been paused alongside the US tariff response, and that Québec has a Starlink contract of its own.
Feature image courtesy Doug Ford via X.
The post Ontario to cancel $100-million Starlink contract in response to US tariff threat first appeared on BetaKit.
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Premier Doug Ford announced the province will no longer sign contracts with American companies.
The post Ontario to cancel $100-million Starlink contract in response to US tariff threat first appeared on BetaKit.
