Donald Trump started the week with a threat. On Monday morning, he posted on Truth Social that tariffs on all Canadian cars, trucks, auto parts, and steel would go up to 50% on January 1, 2027. He accused Canada of “ripping off the United States of America for years” and said, “Canada will be treated like a State no longer!” He ended with a line that will likely be repeated for months: “WE DON’T NEED CANADA, THEY NEED US!” The post arrived three days after trade talks between Washington and Ottawa collapsed and two days after the administration began collecting 50% tariffs on roughly $20 billion in Canadian goods, from dairy and wine to cement and hockey sticks. Reuters reported that the new threat would double the tariff on Canadian vehicles from the current 25% and would tax Canadian auto parts, which have so far escaped a levy, for the first time. The White House did not respond to the wire service’s request for details, and the post did not say which law the president intends to use. Trump’s Truth Social Post Numbers Are Highly Inaccurate Trump wrote that Canada does 95% of its business with the United States. Canada’s own government data puts the American share of Canadian merchandise exports at 71.7% for 2025, the lowest share since the early 1980s and down from 75.9% a year earlier. On the import side, the share of Canadian purchases coming from the United States fell from 62.3% to 58.8% over the same year. Neither figure is anywhere near 95%, and both are moving in the wrong direction for a president who insists Canada cannot survive without American customers. The $60 billion deficit figure is also stale. That number is the goods deficit from 2024, and it leaves out services entirely. Bureau of Economic Analysis data compiled by USAFacts shows the United States imported $453.6 billion in goods and services from Canada in 2025 and exported $426.3 billion, leaving a gap of roughly $27 billion once services are counted, down from $39.4 billion the year before. Most of that gap comes from oil. RSM chief economist Joseph Brusuelas found that in 2024, the U.S. had a $63 billion goods deficit with Canada, but if Canadian crude oil is excluded, the U.S. actually had a surplus of over $50 billion. This is because many American refineries are set up to use the heavy crude that Canada sells at a discount. Statistics Canada said Canada exported $176.2 billion in energy products in 2024, most of it to the U.S. The new tariffs target cars and steel, not the energy trade that causes the deficit. The farm complaint at the top of Trump’s post has the same problem. Canada’s headline dairy tariffs, the ones that run well above 200%, apply only to shipments above the quotas negotiated in Trump’s own USMCA, and FactCheck.org found that American dairy has never paid those rates because exports have never come close to filling the quota. Within the quota, American dairy enters Canada tariff-free. Canada is the second-largest export market for American dairy at about $1.1 billion in 2024, up from roughly $625 million a decade earlier, and the second-largest market for American agriculture overall at $28.4 billion. Canada Has Spent Trump’s Trade War Building An Exit While Trump claimed Canada had no other options, Canada found new markets. Global Affairs Canada said Canadian goods exports to the U.S. dropped 5.8% in 2025, but this was almost completely balanced by a 17.2% increase in exports to other countries, reaching a record high. The share of Canadian exports going outside the U.S. is now the highest in over forty years. For example, gold shipments to the United Kingdom rose 76%, worth about $17 billion, as higher gold prices helped offset lower manufacturing and auto sales to the U.S. Total goods trade between the two countries has now fallen for three consecutive years, and Canada’s merchandise surplus with the United States shrank from $101.3 billion to $81.6 billion in Canadian dollars last year. Prime Minister Mark Carney summed up where that leaves his country on Saturday: “We are stronger now than when the United States started this trade war.” The Tariffs Will Cause Financial Headaches For American Automakers Trump’s post says “Build in the U.S., and there are ZERO TARIFFS,” as if the vehicles crossing the border belonged to some foreign rival. A large share of them belong to General Motors, Ford, and Stellantis, the Detroit Three, which have spent the past two years putting money into Ontario. General Motors builds the Chevrolet Silverado in Oshawa, Ontario, at the only plant in North America that assembles the light-duty and heavy-duty versions on the same line. The plant built 135,800 pickups last year for about 11% of all Canadian vehicle production, and in February GM put another $63 million into its stamping operations to prepare for the next generation of gas-powered full-size trucks, bringing its investment in Oshawa to $1.5 billion since 2020. The Silverado is the second best selling vehicle in the United States, and the V8 engines for GM’s full-size trucks come out of its St. Catharines plant down the highway. Ford spent this year bringing its Oakville Assembly Complex back to life after a retooling that cost more than $1.8 billion and kept the plant dark for two years. The rebuilt plant assembles F-Series Super Duty pickups at a rate of up to 100,000 a year, with roughly 1,800 Canadian jobs on the line and about 150 more at the Windsor Engine Complex, which builds the V8s that go into them. Ford chief executive Jim Farley said when the plan was announced that the company’s Kentucky and Ohio truck plants were “running flat out” and still could not meet demand, which is why the overflow went to Ontario. Those trucks are built for American buyers, and under Trump’s plan every one of them would carry a 50% tariff when it crosses the border. Stellantis builds the Chrysler Pacifica, the Chrysler Voyager, and the Dodge Charger at its Windsor Assembly Plant, directly across the river from Detroit. In February, the company restarted a third shift there for the first time since 2020 and brought roughly 1,700 new workers onto the line to push employment at the plant to nearly 6,000. The Windsor-built 2026 Charger was named North American Car of the Year in January, and Stellantis says it has invested $7.9 billion in Canada since 2022. None of this is hypothetical. The 25% tariff already in place, which applies to the non-American content of vehicles assembled in Canada, has been pulling production south for a year. The Globe and Mail reported that GM boosted Silverado output in Fort Wayne, Indiana, in 2025 even as it planned layoffs in Oshawa, and about 500 Oshawa workers lost their jobs in February when the plant dropped to two shifts. Stellantis moved the next-generation Jeep Compass from its idled Brampton plant to Illinois as part of a $13 billion American investment, and Brampton has now sat closed for more than two years. Trump’s “build in the U.S.” demand is not an invitation. For workers in Oshawa and Brampton, it describes what has already happened to them. The Parts Problem Is Worse Than The Truck Problem The vehicles are only half of it. Trump’s post also promises 50% tariffs on automotive parts, and parts are where the North American industry is most tightly bound together. Flavio Volpe, president of Canada’s Automotive Parts Manufacturers’ Association, told Reuters that American assembly plants would pay the cost of a parts tariff and warned, “Without those specific parts, auto assembly throughout the US would halt.” Cox Automotive analyst Erin Keating said the damage from an unworkable tariff would spread far beyond Canadian plants, because vehicles assembled in Canada depend heavily on parts from American suppliers that employ more than half a million people in the United States. The trade runs the other way too. Canadians bought about 663,000 vehicles built at American assembly plants last year, according to research firm Mobility Global, and spent more than three times as much as American buyers on heavy trucks, buses, and special-purpose vehicles. Patrick Anderson, chief executive of the Michigan-based Anderson Economic Group, had shrugged off Trump’s earlier Canada tariffs on sweaters, honey, and hockey sticks as an annoyance. He did not shrug off this one. He told CNN the auto threat is the real trade war and called it “a body blow to the auto industry.” Unifor, which represents Canadian autoworkers, called the announcement an intimidation tactic and said the instability hurts workers on both sides of the border. The United Auto Workers, which has backed most of Trump’s tariffs, did not respond to requests for comment. Senator Amy Klobuchar of Minnesota said the tariffs have already driven up costs and created chaos, and that Canada’s dollar-for-dollar retaliation will land on her state. What Donald Trump’s Truth Social Post Leaves Out Trump’s post promises to raise the steel tariff to 50%, but the steel tariff has already been at 50% for more than a year, and Reuters noted it was not clear what he meant. The legal footing is murkier still. The Supreme Court struck down the emergency powers law behind Trump’s first wave of tariffs on Canada earlier this year. The $20 billion in Canadian goods hit on Saturday were tariffed instead under Section 338 of the Tariff Act of 1930, a Depression era provision never before used to impose tariffs by any president, and one that caps duties at exactly the 50% the administration has already reached. Monday’s post named no authority at all for the auto and steel increase. The auto executives who spoke to Reuters were skeptical for a different reason. They pointed out that Trump has announced enormous tariffs before that never materialized, that a 50% auto tariff would guarantee massive Canadian retaliation, and that January 1 falls comfortably after the November
