Trump threatens 50% tariffs on all cars and trucks from Canada
President Donald Trump has threatened to impose 50% tariffs on all Canadian automotive imports starting January 1st following the collapse of trade negotiations. The move could significantly disrupt the highly integrated US-Canada automotive supply chain.
Why it matters
The threat of high tariffs on a major trading partner poses significant risks to North American manufacturing and consumer prices for vehicles.
US president Donald Trump sought to increase pressure on Canada on Monday, warning that US tariffs on all cars, trucks and automotive parts from its northern neighbour would be increased to 50 per cent starting on January 1st after trade talks collapsed over the weekend.
The trade deal on the table would have cut the top-line tariff rate on Canadian cars and light-duty trucks from 25 per cent to 15 per cent and the tariffs on aluminium and steel from 50 per cent to 25 per cent, but the deal collapsed on Friday over several points of contention including whether the US tariff relief would have applied to medium or heavy-duty trucks.
“Build in the U.S. and there are ZERO TARIFFS. Canada will be treated like a State no longer!” Trump wrote.
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