U.S. President Donald Trump pledged to double tariffs on Canadian vehicles starting next year, as the neighboring countries and historic allies spiral towards an ever-escalating trade war.
"On January First, 2027, Tariffs on all Cars, Trucks, both large and small, Automotive Parts, and Steel, will be increased to 50%," Trump wrote on Monday on his Truth Social platform.
The current U.S. tariff impacting Canadian autos stands at 25% for non-U.S. content, while imported steel to the United States generally faces a 50% duty.
Trump's latest threat comes after the North American neighbors failed Friday to reach a deal to avert new 50% U.S. tariffs on select Canadian goods. The duties took effect on Saturday.
Canadian Prime Minister Mark Carney has since announced retaliatory tariffs targeting the United States after walking away from what he called a "bad deal."
The new Canadian tariffs will target U.S. steel and dairy industries, while also covering sectors like agricultural equipment, pulp and paper, and electronics.
Canada's response is set to take effect on Sept. 8.
The White House had alleged "discriminatory treatment" by Canada against U.S. alcohol, automobile and dairy products in rolling out the 50% tariffs.
Trump delayed their implementation by three days last week as Washington and Ottawa intensified talks towards a deal.
Top Canadian negotiator Dominic LeBlanc and his team were at U.S. Trade Representative (USTR) Jamieson Greer's office in Washington for hours on Thursday and Friday.
However, both sides failed to reach an agreement after talks that continued late into Friday night.
The latest duties hit about 5.5% of Canadian goods entering the U.S., or some $20 billion worth of products ranging from hockey sticks to cement.
On Monday, Trump charged that "Canada has been ripping off the United States of America for years" and added that "we don't need Canada, they need us."
Greer told The New York Times (NYT) on Saturday that the Trump administration had offered to eliminate a 10% tariff on softwood lumber and reduce the 25% autos tariff.
Washington was also ready to cut steel tariffs from 50% to 25% for the majority of Canadian steel, according to Greer.
Carney said in a statement late Friday that he had decided to suspend trade talks with the U.S., and Greer told CBS on Monday that both sides have yet to schedule further negotiations.
Besides the latest tariff fight, the U.S. and Canada also have to agree on revisions to the U.S.-Mexico-Canada free trade agreement (USMCA), which Trump has declined to renew in its current form.
Trump's threats to make Canada the 51st U.S. state have also antagonized many Canadians.
