US President Donald Trump has threatened to raise tariffs on Canadian cars, trucks, automotive parts and steel to 50 per cent from January 1, 2027, escalating the trade dispute between Washington and Ottawa.
Trump announced the proposed tariffs on Truth Social after trade negotiations between the two countries ended without an agreement. The higher duties would apply to all large and small vehicles, automotive parts and steel imported from Canada.
He said manufacturers could avoid the tariffs by producing vehicles and parts in the United States.
The announcement comes amid growing tensions over trade between the neighbouring countries, whose economies remain closely connected. Canada has already indicated it could retaliate against US tariffs on a range of American products.
Trump accused Canada of imposing unfairly high tariffs on US agricultural goods and claimed these policies had hurt American farmers. He also cited what he described as a $60 billion trade deficit with Canada and said the situation was no longer sustainable.
The US President insisted Washington was not dependent on Canada for trade and argued that Canada relied more heavily on the American market.
The proposed move could significantly deepen the US-Canada trade war, particularly affecting the integrated North American automobile and metals industries. With the January 2027 deadline approaching, the dispute could trigger fresh negotiations or lead to retaliatory measures from Ottawa.
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