Though Canada was excluded from a list of countries, U.S. President Donald Trump is issuing “reciprocal tariffs” with his latest announcement imposing a sweeping 25 per cent tariff on all automobile imports—including those from Canada.
During a declaration speech to signal what he has dubbed “Liberation Day,” Trump has announced a sweeping 25 per cent tariff on automotive imports from every country to come into effect at midnight Wednesday.
“For decades, our country has been looted, pillaged, raped and plundered by nations near and far, both friend and foe alike. American steel workers, auto workers, farmers and skilled craftsmen,” he said in the speech. “They really suffered gravely. They watched in anguish as foreign leaders have stolen our jobs. Foreign cheaters have ransacked our factories, and foreign scavengers have torn apart our once beautiful American dream.”
The announcement from the White House Wednesday means that Canada is still left with a 25 per cent tariff on steel and aluminum, and is subject now to the 25 per cent tariff on automobiles. A carve out for all goods previously negotiated under the CUSMA free trade agreement was granted as well.
All goods not covered by the CUSMA agreement are still subject to tariffs. The release noted that any energy, energy resources and potash not included in the agreement would be subject to 10 per cent tariffs.
According to the Canadian Vehicle Manufacturer’s association vehicles are Canada’s second largest export. In 2023 Canada exported $51 billion worth of the product with 93 per cent of those exports destined for the U.S.
The tariff on automobiles is likely to hit Ontario hard in particular. Auto is Ontario’s top export with the industry accounting for 28.9 per cent of all the province’s exports in 2023. All of Canada’s 14 car manufacturing plants are located in the province.
Alberta Premier Danielle Smith called the announcement an “important win for Canada” and her province, with still more work to be done particularly to remove the other tariffs which are still sure to impact Canadians.
“This is precisely what I have been advocating for from the U.S. Administration for months,” she said on X. “It means that the majority of goods sold into the United States from Canada will have no tariffs applied to them, including zero per cent tariffs on energy, minerals, agricultural products, uranium, seafood, potash and host of other Canadian.”
During his speech, Trump called out Canada’s tariffs on dairy imports into Canada, which reached as high as 250 to 300 per cent tariffs.
“They do the first little carton of milk at a very low price. But after that, it gets bad, and then it gets up to 275 to 300 per cent. They say, ‘oh (we’re charging), about two to three per cent’ but take a look at what happens down the road,” Trump said. “When you look a little bit, it’s not a pretty picture, and we don’t like it, and it’s not fair. It’s not fair to our farmers. It’s not fair to our country.”
He claimed the U.S. “subsidizes Canada by close to $200 billion a year,” a reference not to government handouts but to a trade deficit with Canada.
“Why are we doing this? I mean, at what point do we say, you got to work for yourselves, and you got it. This is why we have the big deficits,” he said. “This is why we have that amount of debt that’s been placed on our heads over the last number of years, and we’re really not taking it anymore.”
As part of his stand against the world which he says has taken advantage of the U.S.’s free trade policies Trump announced reciprocal tariffs to a list of 50 different nations.
To celebrate Canadians, Canada was not named on the list, although it has tariffs against the U.S. as part of supply management laws. The list shows how much tariffs each country levies against America, followed by the often lower “reciprocal” tariffs the U.S. imposes in response.
Trump said any company not wanting to pay the tariffs would have to move its manufacturing to America. He noted several companies, including Meta, Apple, and General Motors, which have already begun investing up to $500 billion each in moving production to the U.S.
He also said any nation hit with reciprocal tariffs wishing to remove them will have to remove their own tariffs, drop their trade restrictions and not “manipulate” their currencies.
“I think you’re going to remember today. It’s going to be a free nation that we’re dealing with. We’re going to have a very free and beautiful nation,” Trump said. “It’s going to be Liberation Day in America, and it’s going to be a day that hopefully you’re going to look back in years to come and you’re going to say, you know, he was right, this has turned out to be one of the most important days in the history of our country.”