Members of Canada’s automotive industry are expressing a mix of frustration, confusion, and concern in response to President Donald Trump’s new threats to double certain American tariffs on vehicles, auto parts, and steel from Canada. Following Canada’s rejection of a U.S. trade proposal, Trump announced on Truth Social that tariffs would increase to 50 percent from current levels starting on January 1, 2027.
CEO of Global Automakers of Canada, Lucas Malinowski, expressed uncertainty regarding the seriousness of Trump’s announcement, stating that similar outbursts in the past have not necessarily resulted in changes to tariff and trade policies. Malinowski’s industry group represents major international automakers such as Toyota, Volkswagen, BMW, Honda, Hyundai, Nissan, and Mercedes-Benz.
Trump’s threat to raise tariffs marks the latest development in the Canada-U.S. trade conflict, which intensified after talks collapsed before the midnight deadline on Friday to avoid 50 percent U.S. tariffs on approximately $28 billion worth of Canadian goods. Prime Minister Mark Carney vowed to match American tariffs “dollar for dollar” after September 8, focusing on U.S. steel, dairy, appliances, agricultural equipment, pulp and paper, and electronics in Canada’s response.
In a social media post on Monday morning, Trump criticized Canada, describing it as “among the worst nations in the world to deal with,” and claiming that the country heavily relies on the U.S. for business. Currently, imported finished vehicles and non-CUSMA-compliant auto parts face 25 percent tariffs when entering the U.S., 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 emphasized that the U.S. auto assembly would bear the cost of these tariffs, as they are the importers of record.
The ongoing trade war has already had a negative impact on the automotive industry, according to Malinowski, who highlighted a significant decline in U.S. exports to Canada. He estimated that tariffs and trade disruptions have added $110 billion in costs over the past year and a half to the North American auto sector.
Ontario Premier Doug Ford criticized Trump’s latest tariff threat, calling him “arrogant” and “cocky,” and labeling him as a bully. Ford emphasized the need for a strong response to Trump’s actions, stating that the U.S. president will face consequences for his behavior.