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Trump Tariffs Will Disrupt Automotive Supply Chain, Says GM Canada President

The Canadian division of GM is warning that President Donald Trump’s proposed new tariffs would harm both American and Canadian economic interests. Trump has threatened a 25% tariff on all goods from Canada and Mexico until those countries can stem the tide of illegal immigration and drug trafficking.

“It is a disruption that is in no one’s interest, especially in the U.S.,” GM Canada President Kristian Aquilina said in an interview, according to Bloomberg. “It’s an industry that’s been built over a long period of time to assume natural flow of goods,” Aquilina added on the trade relationship between the U.S. and Canada as it relates to vehicles and their components.

GM Canada President Kristian Aquilina.

Kristian Aquilina

Cars are already getting harder to afford in Canada because of a weakening Canadian dollar, the value of which has fallen by 4.5 percent against the U.S. dollar since election day. “The cost of those vehicles for us to purchase, and then sell to our dealers and customers, is getting higher,” Aquilina said.

If Trump imposes the proposed 25% tariff on Canadian goods and the Canadian government responds with retaliatory tariffs on American-made cars, it would make vehicles even more expensive for the Canadian consumer. This affordability problem is exacerbated by the abrupt end of Canada’s iZEV federal EV incentive, which was paused indefinitely last week.

President Donald Trump.

Canada is highly dependent on U.S. imports for its automotive market. Based on sales by dollar value, approximately half of the cars sold in Canada are imported from the U.S., according to research by the Trillium Network for Advanced Manufacturing. Further, 65 percent of Canada’s auto parts imports come from the States.

Trump’s most recent comments from the Oval Office regarding the proposed 25% tariff on the North American neighbors of the U.S. indicated that such tariffs could go into effect as soon as February 1st, 2025. Whether it’s a serious policy proposal or a bargaining chip to bring Canada and Mexico to the negotiating table to reform the U.S.-Mexico-Canada Agreement (USMCA) remains to be seen, but we’ll know for sure in the next few weeks.

George is an automotive journalist with soft spots for classic GM muscle cars, Corvettes, and Geo.

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