Canadian government readies response to Trump’s auto tariffs

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OTTAWA — Prime Minister Mark Carney will make an announcement at 1:30 p.m. on Thursday in response to U.S. President Donald Trump’s decision to impose 25 per cent tariffs on all foreign-made autos and parts as of April 2.

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Automobiles and their components are the second largest Canadian export to the United States after oil and gas.

A “fact sheet” released by the White House says the tariff will be applied to all imported cars and light trucks and “key” auto parts, specifically engines, transmissions, powertrain parts and electrical components.

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Vehicles and auto components imported under the Canada-United States-Mexico Agreement (CUSMA) free trade deal will only be tariffed on the value of parts built outside the U.S.

Wednesday’s tariffs come in addition to tariffs Trump has already promised to announce on April 2, which could target lumber and pharmaceuticals.

Canadian politicians’ response to the new tariffs was fierce, with all federal party leaders denouncing the “unjustified” tariffs as an assault on workers.

On Thursday morning, Prime Minister Mark Carney met with the federal cabinet committee on Canada-U.S. relations in Ottawa to discuss the country’s response to the latest tariff salvo.

Following the meeting, Minister of Jobs and Families Steven MacKinnon said that two changes to Employment Insurance (EI) recently promised by Carney to speed up claims for workers laid off because of tariffs would kick in on Saturday.

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The first is a six-month waiver of the one-week waiting period for EI for all applicants. The second is a six-month suspension of the requirement for claimants to use up separation monies (such as severance or vacation payouts) before receiving EI.

https://x.com/MarkJCarney/status/1905041891453739485/video/1

“What we saw yesterday is going to do two things: it is going to bring the price up for U.S. consumers and it’s going to bring competitiveness down for U.S. industries. So today is all about fighting for Canadians,” said Finance Minister François-Philippe Champagne before the meeting.

Wednesday evening, the head of the Global Automakers of Canada (GAC), an industry group representing the largest European and Asian automakers cautioned against imposing retaliatory tariffs.

“We would advise, you know, in an ideal world, not to retaliate on cars and certainly not on auto parts, which are used by all manufacturers in terms of producing vehicles here,” said GAC president and CEO David Adams.

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“But I mean, look, we’re in the middle of an election, and the sentiment of most Canadian seems to be that they’re looking for strong action from their leaders to respond to these these unjustified tariffs. So I suspect we will see some retaliation,” he added.

More to come.

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