A trade war ceasefire? Not so fast. Trump owns Canada's automotive industry
A trade war, two are going to go – maybe more. U.S. President Donald Trump pulled tariffs on Canada after striking the economy from markets, factories to borders.
But this is the battle this week.
There is another next week, his steel and aluminum tariffs are in effect. Three weeks after this, when Trump threatens other tariffs in many countries.
In recent days, private and public comments from the Trump team have ridiculed the idea that stopping fentanyl is the main reason for its tariff policy.
Canada's biggest risk is now the focus. If you are bad news, if you are Thousands of Canadians’ jobs are related to the automotive department. His goal may be you.
In the closed conversation, members of the Trump team have been pushing auto companies to significantly expand their long-term footprint in Canada and Mexico in exchange for permanent tariff relief — without success so far, with sources related to the industry who spoke on the condition that they did not name.
U.S. President Donald Trump said Thursday that his tariffs on some goods in Canada and Mexico fall under Canadian-US-Mexico rule until April 2.
The Trump team has gone almost that far in public.
“Flights are produced here,” his press secretary Karoline Leavitt asked the car company about her concerns about tariffs in April.
Howard Lutnick, the Commerce Secretary of Fox News, made the same point:
“Why our Michigan [auto] Does he work in Canada? ” he asked.[Trump’s] To say, 'Come back. return. '”
Trump himself described his conversation with three major U.S. automakers this week, saying he promised brief measures of previous and so-called fentanyl tariffs to allow them to plan.
But he warned that future tariffs would not be exempted.
“I told them, 'That's it. It's a short-term deal,'” Trump said Thursday.
“I said …'Don't come back to me after April 2.' “'I don't want to hear from you after April 2. '”
Most Canadian-made vehicles are exported to the United States, and Canada sells more vehicles than they buy. But the industry is not a one-way street: Canada is the biggest buyer of American-made cars, while parts are cross-border borders.
What will happen next
Trump is now threatening to have two phases of tariffs.
First, with 25% tax on steel and aluminum next week, the automotive industry will work to review the fine prints exempted as these metals are their main components. Without waivers, vehicles will face penalties for price increases.
He then planned to punish so-called unfair trade practices on tariffs on countries around the world – starting as early as April 2. This is a report prepared by his orders, which should expire on April 1.
Trump made it clear on Thursday that he sees Canada as one of the main goals. He is preparing for the renegotiation of the Canada-US-Mexico deal. Under the law that must happen in the next decade, but is now expected to be on the accelerated timetable.
Trump complains about everything from Canada's protected dairy sector to bank regulations to GST. Dairy products often come out in tense Prime Minister Justin Trudeau this week with a blasphemous call.
Will the ace retreat again?
He vowed that he wasn't frightened by the rivers on the Red River across the trade screen this week, which represents a loss in the stock market.
“I'm not even looking at the market,” Trump insisted.
Prime Minister Justin Trudeau spoke in a child care announcement in Ottawa on Thursday and was asked to describe his recent call with U.S. President Donald Trump. Trudeau, who did not provide specific details, stressed that the dialogue was ongoing and reiterated that Canada was focusing on how to help people respond when levy was levied.
The look of chaos
However, the market is studying the economy. And it's getting messy. Customs brokers have a unique advantage in real-world impact.
Jesse Mitchell, director of Ottawa's business development, who works with hundreds of cross-border companies, said the company had unexpected bills on its bills – $50,000, $75,000 and $100,000; some because their shipments were late than expected, but midnight on Tuesday, when tariffs started.
In other cases, they do not know that they owe tariffs. Mitchell, for example, cites a Canadian company that repairs heavy machines.
He said the company will import the motor for $50,000 for repairs and then ship it back to the U.S. and only realize they have to pay 25% of the bill to send it back to the border.
Canadian companies have no choice. Many people have paid tariffs to avoid losing U.S. customers, he said.
Faced with this, companies on both sides blocked shipments – assuming Trump would quickly retreat, Mitchell said.
He has to some extent. Trump has already tariffs on goods deemed to be in line with the Canadian-US Mexico Agreement, which does not cover disputed areas such as wood, dairy products and certain other products. Even there, the details are not clear.
“It causes headaches for everyone – of course in Canada, but it may also cause headaches in the United States,” Mitchell said.
Seeing chaos approaching, the company is eager to deliver goods by Tuesday.
From November to January, exports of goods to the U.S. surged, with Montreal banks linked Thursday to tariffs and the abused Loonie trend.
The Canadian Chamber of Commerce said Thursday's probation would reduce some losses. But it's almost not all.
“This is not a time to celebrate. The economy is not a toy,” Matthew Holmes, vice president of the chamber, said in a statement.
“The ongoing threat and economic uncertainty have caused huge losses. We see this in delayed business investment, shaky consumer confidence, stagnant capital flows and volatile stock markets. People's livelihoods are under threat.”
For Canada, these livelihoods exist in many sectors. Thousands of Canadian steel workers may feel next week, let alone the bigger automotive industry.
Economics may not be a game. But workers will be forced to play ball – round after round.
