Trade talks between the United States and Canada have reached an impasse over disagreements surrounding automobile tariffs, with less than 36 hours remaining before the deadline for new U.S. tariffs. Bloomberg reports, writes UNN.
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According to the publication's sources, Canada is insisting on lowering the automobile tariff to 10% or expanding the existing exemption for U.S. auto parts. At the same time, Donald Trump's administration is insisting on a minimum rate of 15%.
Last year, Trump imposed 25% tariffs on foreign automobiles and trucks, but provided partial exemptions for Canada and Mexico depending on the share of U.S. parts in production. Washington is also demanding that Ottawa cancel retaliatory tariffs on U.S. goods and a number of provincial restrictions on the sale of alcohol from the United States.
Canada prepares for a possible new round of tariffs
Canadian negotiators worked in Washington over the weekend, trying to reach an agreement by August 19. Trump threatened to impose new 50% tariffs on a range of Canadian goods if no agreement is reached.
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Canadian Prime Minister Mark Carney said he plans to speak with Trump before the deadline expires, but the government is preparing for "all contingencies." Canadian officials are also considering possible measures in response to new U.S. tariffs.
The automotive industry is particularly important to Canada. Large plants are located in Ontario, and General Motors, Ford, and Stellantis have manufacturing facilities there. At the same time, a significant share of the country's vehicles is produced by Japan's Toyota and Honda.
In addition to the automotive industry, the parties have disagreements over Canada's dairy industry, as well as U.S. tariffs on Canadian lumber and steel.