Just last week, automakers were hoping summer U.S.-Canada trade talks would deliver relief from Washington’s 25% tariffs that have raised the cost of shipping vehicles and parts across the border.
Instead, their problem got twice as bad on Monday, when U.S. President Donald Trump declared a 50% levy on vehicles, auto parts and trucks from Canada, effective on January 1.
“We cannot end up in a place come January next year where Canada — a major market for U.S.-made vehicles and parts and whose vehicle exports contain significant U.S. content — is being treated like China,” one industry executive told Reuters. The planned 50% tariffs on Canada would rival the levies currently in place on some gasoline-fueled cars imported from China.
The trade deal that fell apart would have cut the top-line tariff rate on Canadian cars and light-duty trucks from 25% to 15%.
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