US President Donald Trump said the United States will double tariffs on Canadian cars and trucks to 50 percent from January 1, 2027, and impose a 50 percent tariff on Canadian auto parts.
The threatened measures follow the collapse of trade negotiations between Washington and Ottawa late last week. Trump also said Canadian steel tariffs would rise to 50 percent, although steel tariffs were already at that level, leaving the intended change unclear.
What Trump announced
Trump said the new auto-parts tariff would apply to products that had not previously faced a levy. The announced vehicle and parts tariffs would be in addition to 50 percent tariffs imposed on Saturday after the negotiations failed.
Trump wrote on Truth Social that companies could avoid tariffs by building in the United States. He also said Canada would no longer be treated like a state and argued that the United States did not need Canada. The White House and the Canadian government did not immediately provide further details or comment.
Related coverage: Canada to match US tariffs after trade talks miss Friday deadline.
How the dispute reached this point
The United States and Canada failed to reach a trade deal late on Friday, with both sides blaming the other. Canada prepared tariffs on some US goods in response to 50 percent US levies on other Canadian products.
Trump made the latest announcement on Monday. The source report said executives in the auto industry questioned whether the threat would take effect, noting that previous large tariff announcements had not materialized and that a measure of this size could trigger major Canadian retaliation.
Why the auto industry is concerned
US auto production is closely integrated with Canada and Mexico, so tariffs on parts could affect assembly plants in the United States. Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association, said US auto assembly would pay the tariff on Canadian parts and could halt without those components.
Canada remains one of the United States’ two largest trading partners. Goods and services trade between the countries totaled $872.3bn last year, down 4.6 percent. Canada sent more than three-quarters of its goods exports to the United States and bought almost half of its goods imports from the country.
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