BRP Inc. (NASDAQ:DOO) shares dropped 20% on Wednesday after the company suspended its fiscal 2027 outlook in response to recent changes in U.S. tariff policy.
The powersports manufacturer pulled its full-year guidance after amendments to Section 232 tariffs on steel, aluminum and copper imports into the United States took effect on April 6, 2026. Under the revised rules, a 25% tariff is now applied to the total value of imported snowmobiles and most off-road vehicles, replacing the previous system that imposed a 50% duty only on the metal content.
BRP said the updated tariff structure is expected to add more than $500 million in incremental costs for the remainder of the year, before taking into account any mitigation efforts.
“Like many manufacturers, we are operating in a highly volatile and unpredictable tariff environment that continues to create uncertainty across the market,” said Denis Le Vot, President and CEO of BRP.
Le Vot added that, despite the significant cost impact, the company believes it can navigate the situation thanks to its strong balance sheet, operational flexibility and solid start to the year.
The shift in tariff methodology marks a major change in BRP’s cost base, particularly as the company imports a large share of its snowmobile and off-road vehicle products into the U.S. market. Moving to a tariff based on total product value substantially increases the financial burden compared with the previous approach focused solely on metal inputs.
BRP had previously issued fiscal 2027 guidance, but this has now been withdrawn until there is greater clarity on the evolving tariff landscape and the company’s ability to offset the additional costs.