Trump threatens 50% tariffs on Canadian autos and steel

President Donald Trump escalated a widening trade fight with Canada on Monday, threatening to impose 50% tariffs on Canadian cars, trucks, auto parts and steel starting Jan. 1, 2027, after negotiations between Washington and Ottawa collapsed.

“Canada has been ripping off the United States of America for years,” Trump wrote on Truth Social. “On Trade, and in other ways, also, they are among the worst Nations in the World to deal with.”

Trump said tariffs on “all Cars, Trucks, both large and small, Automotive Parts, and Steel” would rise to 50%, and added that vehicles built in the United States would not be subject to the duties, CBS News reported. “Canada will be treated like a State no longer!” he wrote.

The announcement came days after Canadian Prime Minister Mark Carney said Canada would retaliate against new U.S. tariffs on Canadian goods. A 50% U.S. tariff on a broad range of Canadian imports took effect at 12:01 a.m. ET Saturday after weeks of talks broke down. NBC News reported that the duties covered goods ranging from hockey sticks to building materials, while CBS News reported they included hundreds of Canadian goods, including hockey sticks and agricultural products.

Carney pulled Canadian negotiators out of the talks late Friday, saying the United States had “proposed new terms that were uneconomic” and “unfair.”

“We cannot control the storm blowing in from Washington,” Carney said Saturday. “Canada will match Washington’s new tariffs dollar for dollar in order to protect Canadian workers, farmers, families, and businesses.”

CBS News reported that Canada’s retaliatory tariffs on U.S. products are set to take effect Sept. 8, according to Carney.

U.S. Trade Representative Jamieson Greer sought to minimize the effect of the Saturday tariffs shortly before Trump’s post. “I think the markets understand that this affects a very small amount of trade,” Greer told CNBC, according to NBC News. He also said he would not describe the tariffs as a “trade war.”

Carney used sharper language. “You’re at war when you get attacked,” he told reporters in Ottawa on Saturday. “We got attacked.” He said Canada had waited to retaliate “until the United States decided to actually implement these so-called [Section] 338 tariffs.”

Canada is the third-largest source of U.S. imports. In 2025, more than $380 billion in goods crossed into the United States from Canada, according to U.S. Census data cited by NBC News.

Trump did not say Monday whether automobiles and auto parts that comply with the U.S.-Mexico-Canada trade pact would remain exempt from additional duties. Canadian-made vehicles that do not meet USMCA requirements currently face a 25% U.S. tariff. Steel imported from Canada already faces a 50% U.S. tariff, and NBC News reported it was not clear whether Trump’s announcement would raise that tariff to 100%.

Higher tariffs on autos and parts could be especially disruptive because the United States, Canada and Mexico have tightly linked auto supply chains. Vehicles often cross borders multiple times before final assembly and delivery to dealerships.

The dispute also adds pressure to the USMCA, the trade agreement Trump negotiated and signed during his first term after replacing NAFTA. On July 1, the Trump administration announced it would not renew the USMCA in its current form, leaving it subject to rolling annual reviews and negotiations.