Trump Threatens to Double Canadian Auto Tariffs from Jan 1 as US-Canada Trade Rift Deepens

Washington DC: US President Donald Trump said Monday that tariffs on Canadian-made vehicles would be doubled starting next year, deepening an already escalating trade conflict between the two North American neighbours.

In a post on Truth Social, Trump stated that beginning January 1, 2027, duties on all cars, trucks of every size, automotive parts and steel would climb to 50 percent. At present, Canadian autos with non-US content face a 25-percent US tariff, while steel imports into the United States are already subject to a 50-percent levy.

The announcement follows the collapse of negotiations last Friday aimed at averting new 50-percent US tariffs on a range of Canadian goods, which came into force Saturday. Canadian Prime Minister Mark Carney responded by unveiling retaliatory tariffs of his own, having stepped away from what he termed a "bad deal."

Canada's countermeasures are aimed at US steel and dairy exports, along with agricultural machinery, pulp and paper products, and electronics, and are scheduled to take effect on September 8.

The newly imposed tariffs affect close to 5.5 percent of Canada's exports to the US, valued at approximately $20 billion and spanning products from hockey sticks to cement.

Speaking on Monday, Trump accused Canada of exploiting the US economically for years, asserting that America had no need for Canada, while Canada, in his view, depended on the US.

US Trade Representative Jamieson Greer told the New York Times on Saturday that Washington had proposed scrapping the 10-percent softwood lumber tariff and lowering the 25-percent tariff on autos, and had also offered to reduce steel tariffs from 50 percent to 25 percent for most Canadian steel. Despite these offers, Carney announced in a Friday night statement that he had suspended trade talks with the US altogether.

Beyond the current tariff dispute, both countries continue to face a separate impasse over renewing the US-Mexico-Canada Agreement (USMCA) in its existing form, which Trump has refused to extend. Tensions have been further inflamed by Trump's repeated suggestion that Canada should become the 51st US state, a remark that has drawn considerable backlash from the Canadian public.