President Donald Trump says the 25% tariff he slapped on vehicles built in Canada could increase, even as his administration talks with Ottawa about a wider trade deal.
“I put tariffs on Canada, they are paying 25% but that could go up,” Trump told reporters in the Oval Office on Wednesday.
“When we put tariffs on, we are saying, ‘We don’t want your cars.’”
The tariffs, imposed earlier this month, target every car shipped to the US from Canada.
A partial carve-out under the Canada-US-Mexico Agreement means only non-American parts inside those vehicles are taxed, but separate tariffs on components are set for May 3.
Trump argues Canada is luring assembly jobs away from the US.
For more than a century, however, factories on both sides of the border have shared production lines, with parts crossing several times before a finished car rolls off the line and into a dealer’s showroom.
The Big Three automakers, Ford, General Motors, and Chrysler (Stellantis), say the tariffs will add $41.9 billion USD to their costs, part of $107.7 billion USD in extra charges forecast by Michigan’s Center for Automotive Research.
Industry lobbyists have pressed the White House to scrap the duties, but Trump insists companies should build everything at home.
Ottawa made several small changes to its countermeasures last week.
Automakers that keep making vehicles in Canada can import a limited number of US-assembled models tariff-free.
The allowance decreases if Canadian output or spending decreases.
Trump has also placed a 10 % universal tariff on most countries and a 145% tariff on Chinese goods, prompting Beijing to answer with a 125% tariff on US goods.
Trump praised recent phone talks with Liberal Leader Mark Carney yet repeated the US “doesn’t need anything from Canada.”
“We’re working on a deal,” said Trump.
“We’ll see what happens.”
