Canadian Tire sees soft consumer sentiment amid trade war, rising prices

Canadian Tire Inc. is navigating a challenging retail landscape where consumers are increasingly prioritizing value, according to company executives. President and CEO Greg Hicks noted that "consumer sentiment remained soft" in the last quarter, a trend influenced by persistent trade war threats and the daily pressure of higher food and gas prices.

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consumer sentiment remained soft

To address this, Canadian Tire has sharpened its value proposition. The company employed AI-driven analysis, dubbed DaiVID, to lower prices on over 5,000 products, particularly essentials like cleaning supplies and storage. This strategy, along with a growing loyalty program, helped meet consumers "where they are," Hicks stated on a call with analysts. Chief Operating Officer TJ Flood elaborated that price adjustments are deliberate, guided by AI models and elasticity curves to target areas where Canadians seek value, while also monitoring competitive activity.

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For a long while now, consumers have been living with the threat of trade wars and tariffs and managing the day-to-day pressure of higher food and gas prices.

While Canadian Tire confirmed its AI tools inform pricing and promotions, a spokesperson clarified that they are not used for dynamic pricing strategies that could raise prices. The company reported overall sales increased 0.7 percent for the quarter ending July 4, 2026. However, comparable sales saw stronger growth at Sport Chek (up eight percent) and Mark's (up 4.2 percent), suggesting specific brands are performing better. Other retailers, including Dollarama and Walmart, have also reported increased sales driven by value-conscious shoppers, and Metro plans to convert stores to its discount Food Basics banner, underscoring a widespread consumer shift towards affordability.

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We kept our value proposition sharp using our DaiVID AI analysis to drop prices on more than 5,000 products, and we saw strong customer response to lower prices on essentials like cleaning and storage.