The tariffs announced by Donald Trump have already caused significant damage just days after the announcement. Stellantis, for example, has been forced to lay off more than 5,000 employees in the United States and Canada. Now Canadian Prime Minister Mark Carney is announcing countermeasures in response to the tariffs imposed by President Trump, calling them “unjustified and unmotivated.” These U.S. measures have destabilized global markets and exacerbated pre-existing trade tensions.
Canada responds to Trump’s tariffs and announces countermeasures
Canada has responded by imposing a 25% tariff on two categories of vehicles from the United States: fully assembled vehicles that do not comply with the CUSMA agreement and on non-Canadian/Mexican content of CUSMA-compliant vehicles. To avoid these tariffs, vehicles should contain at least 75% North American components, a requirement that only some models can meet.
According to the Canadian government, the proceeds from the new tariffs will be entirely allocated to supporting workers in the automotive industry, a sector already hit by Stellantis’ decision to halt production at its Windsor plant following the U.S. measures.
Carney emphasized that the global economy is undergoing a radical transformation, requiring decisive responses to protect Canadian industry and workers. He reiterated the government’s commitment to defending national interests and strengthening the Canadian economy in the G7 context.
The trade dispute risks having negative consequences for both nations, considering that Canada and the United States enjoy the ‘most dynamic and comprehensive trade relationship in the world,’ with a daily exchange of goods and services estimated at $2.5 billion ($3.5 billion Canadian dollars) and supporting millions of jobs in both countries.