- Vehicles built in Canada and sold in America could become considerably more expensive come January if President Trump follows through with his latest promise.
- The U.S. President threatened to impose 50 percent tariffs on cars, light- and heavy-duty trucks, auto parts, and steel crossing the border from Canada.
- The plan was announced after failed trade negotiations between Canada and the United States, aimed at reducing the impact of tariffs in place since April 2025.
President Trump on Monday promised to hike tariffs on the Canadian automotive sector to 50 percent come January 1, 2027. According to the president, the new tariffs would apply to cars and trucks—both light- and heavy-duty models—as well as auto parts and steel.
The threat of higher tariffs comes on the heels of trade negotiations between Canada and the United States that unravelled late last week. The trade talks were aimed at reducing or removing the two-way tariffs that have been in place since last April.
In the aftermath, each country is blaming the other for the talks failing. “We were not prepared to compromise Canada’s sovereignty or to undermine our key industries,” Canadian Prime Minister Mark Carney told reporters.
Medium- and heavy-duty trucks, in particular, were reportedly a sore spot for both sides. Sources at the White House told Politico that Canadian negotiators brought up heavy trucks as an issue in the 11th hour, which threw a wrench in the talks. Carney denied the claim. “No is the short answer,” he said on Saturday. “We clarified what was on offer and were continually disappointed by the answers.”
From his point of view, Carney said the Americans changed their tune on the trucks near the end of the talks. According to Carney, the U.S. side pushed at the last minute to remove the larger trucks from tariff relief, even after both sides agreed to lower the tariff on autos to 15 percent. The dissolution of the talks means that the nominal 25 percent rate will still be applied to cars built in Canada.
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Jack Fitzgerald’s love for cars stems from his as yet unshakable addiction to Formula 1.
After a brief stint as a detailer for a local dealership group in college, he knew he needed a more permanent way to drive all the new cars he couldn’t afford and decided to pursue a career in auto writing. By hounding his college professors at the University of Wisconsin-Milwaukee, he was able to travel Wisconsin seeking out stories in the auto world before landing his dream job at Car and Driver. His new goal is to delay the inevitable demise of his 2010 Volkswagen Golf.
