Members of the Canadian auto industry are expressing a mix of frustration, confusion, and concern in response to U.S. President Donald Trump’s new threats to double certain American tariffs on cars, trucks, auto parts, and steel from Canada. Following Canada’s rejection of a U.S. trade proposal, Trump announced on Truth Social that the tariffs would increase to 50 per cent from current levels starting on January 1, 2027.
Lucas Malinowski, the CEO of Global Automakers of Canada, stated that it is challenging to gauge the seriousness of Trump’s announcement. He mentioned that previous outbursts of this nature did not always result in actual changes to tariff and trade policies. The industry group he represents includes major international automakers like Toyota, Volkswagen, BMW, Honda, Hyundai, Nissan, and Mercedes-Benz.
Trump’s threat to raise the tariffs marks the latest development in the Canada-U.S. trade dispute following failed talks before the deadline to avoid significant U.S. tariffs on approximately $28 billion worth of Canadian goods. Prime Minister Mark Carney pledged 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, calling it “among the worst Nations in the World to deal with.” He claimed that Canada is overly reliant on the U.S., conducting 95% of its business with the country. Currently, imported finished vehicles and non-CUSMA-compliant auto parts from Canada face 25% tariffs, while Canadian steel is subject to tariffs ranging from 10% to 50%.
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 by Canadians. He emphasized that the U.S. auto assembly would bear the brunt of these tariffs, potentially disrupting auto production across the country.
The escalating trade tensions have already impacted the industry, with Malinowski noting a decline in U.S. car exports to Canada by 22% and $7 billion over the past year. He 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 threats, stating that the U.S. president can “kiss my ass.” Ford called Trump arrogant and a bully, emphasizing the need to stand up against such behavior.