Trump Threatens Tariffs on Canadian-Made Cars

Irving Hamilton
August 11, 2018

Auto industry officials familiar with the talks said the Trump administration wants the ability to impose national security tariffs on future Mexican production from new auto assembly and parts plants.

President Trump on Friday threatened tariffs on Canadian-made cars if USA officials can't strike a deal with the country on overhauling the North American Free Trade Agreement.

Canada would have to wait on a trade deal due to "tariffs and trade barriers" but the making progress with Mexico, President Donald Trump tweeted Friday night. "And then the idea will be can we get a big trade deal prior to [Donald Trump's] next election" in 2020, Farley said.

The U.S. -Mexico talks for a reworked North American Free Trade Agreement resumed three weeks ago, without Canada, after negotiations involving all three members of the $1.2 trillion trade bloc stalled in May.

Administration officials and congressional aides have said the vehicle tariff probe, like the metals tariffs, in part is aimed at winning concessions during ongoing NAFTA renegotiation talks. But he threatened Canada with auto tariffs if the US and Canada can't forge a deal. "We'll keep standing up for Canadian interests as we work toward a modernized trilateral NAFTA agreement".

To complicate matters, the already rocky Canada-U.S. relationship has deteriorated since the partners suspended talks in the spring. "And in June, Trump called Prime Minister Justin Trudeau very dishonest and weak" shortly after he left the G7 meeting in Quebec.

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On Friday, his critical tweet about Canada made a point of praising Mexico's president-elect Andres Manuel Lopez Obrador.

The federal government finds itself in a holding pattern on NAFTA negotiations with one-on-one talks between the United States and Mexico set to spill into next week.

Adam Austen, a spokesman for Canada's foreign minister, added: "We're glad Mexico and the USA continue to work out their bilateral issues".

Earlier Friday, U.S. officials met Mexican counterparts in Washington to resolve.

"We continue to be in the same position where Mexico and the USA need to continue to work out their issues", said the Canadian source, who spoke on condition of anonymity because they weren't authorized to speak publicly about the matter.

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