Members of Canada’s automotive industry are expressing a blend of irritation, uncertainty, and apprehension in response to U.S. President Donald Trump’s latest warnings about potentially doubling certain American tariffs on vehicles, trucks, automotive components, and steel from Canada. Following Canada’s rejection of a U.S. trade offer late last Friday, Trump announced on Truth Social on Monday that the duties could increase to 50 percent from their current levels starting on January 1, 2027.
Lucas Malinowski, the CEO of Global Automakers of Canada, expressed difficulty in gauging the seriousness of Trump’s statement. He mentioned that past outbursts of this nature did not necessarily result in changes to tariff and trade policies, and they are waiting to see if this instance will be different. The industry group that Malinowski represents includes major international automakers like Toyota, Volkswagen, BMW, Honda, Hyundai, Nissan, and Mercedes-Benz.
Trump’s threat to raise these tariffs is the latest development in the Canada-U.S. trade conflict, which escalated after negotiations collapsed before the midnight deadline on Friday to prevent 50 percent U.S. tariffs on approximately $28 billion worth of Canadian goods. Prime Minister Mark Carney responded by pledging to match American tariffs “dollar for dollar” following September 8, focusing on U.S. steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics.
In a post on Monday morning, Trump criticized Canada, calling it “among the worst Nations in the World to deal with.” He emphasized that Canada relies heavily on the U.S. for business. Currently, imported finished vehicles and non-CUSMA-compliant auto parts from Canada face 25 percent tariffs, while Canadian steel is subject to tariffs ranging from 10 percent to 50 percent.
Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, clarified that the increased tariffs Trump is threatening would be paid by the U.S. auto industry, not Canadians. He explained that the importer of record is responsible for paying the tariffs, and if the U.S. imposes tariffs on Canadian auto parts, it would impact U.S. auto assembly operations.
The ongoing trade dispute has already had negative effects on the industry, according to Malinowski. He highlighted that Canada is the largest market for U.S.-made cars, with exports to Canada down by 22 percent and $7 billion over the past year. Malinowski estimated that tariffs and trade disruptions have added $110 billion in costs to North America’s auto sector over the last 18 months.
Ontario Premier Doug Ford criticized Trump’s tariff threat, stating that the U.S. president can “kiss my ass” and emphasizing the need to retaliate strongly. Ford described Trump as arrogant and a bully, predicting that he will face consequences for his actions.