Canada seeks removal of U.S. Section 232 automotive tariffs before CUSMA review.
CVMA says U.S. market access remains essential for Canadian vehicle manufacturing.
Industry leaders urge Ottawa to restrict Chinese EV imports and related technologies.
Canada’s chief trade negotiator and representatives of Detroit automakers are delivering a similar message ahead of the upcoming review of the Canada-United States-Mexico Agreement (CUSMA): preserving North American automotive integration remains essential to the future of Canada’s vehicle manufacturing sector.
Speaking at the Automotive Parts Manufacturers’ Association annual summit, Janice Charette, Canada’s chief trade negotiator to the U.S, said Canada intends to remain a vehicle-producing nation despite continued trade pressure from Washington. She described the automotive sector as a cornerstone of the Canadian economy and a key contributor to the country’s industrial capacity.
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Charette said Ottawa’s primary objective in ongoing discussions with the United States is to reduce, ideally eliminate, tariffs imposed under Section 232 of the U.S. Trade Expansion Act. The measures include the well-used 25% duties on Canadian vehicle exports and have increased costs for manufacturers operating within the highly integrated North American supply chain.
Canada is also seeking to preserve the trilateral structure of CUSMA as the agreement approaches its scheduled six-year review on July 1. The three member countries must decide whether to extend the pact for another 16 years or continue with annual reviews. Charette indicated that a full renewal would provide the strongest level of certainty for automotive investment, while annual reviews would represent a less desirable but acceptable alternative.
Potential changes to automotive rules of origin are also being monitored closely. The U.S. has proposed increasing regional content requirements for vehicles qualifying for preferential treatment under the agreement. Canada’s position is that any revisions should not offset gains achieved through tariff reductions.
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The same emphasis on North American integration was echoed in testimony before the House of Commons Standing Committee on International Trade by Canadian Vehicle Manufacturers’ Association president Brian Kingston.
Representing the Canadian operations of Ford, General Motors and Stellantis, Kingston argued that diversification beyond the U.S. market is not a realistic strategy for Canada’s auto industry. More than 90 % of Canadian vehicle production is exported to the U.S., making access to that market absolutely critical.
Kingston urged the federal government to cancel a trade arrangement signed with China in January that allows up to 49,000 Chinese electric vehicles to enter the Canadian market annually. He warned that the agreement could weaken manufacturers that have invested in North America and create risks for the continent’s automotive supply chain.
The CVMA is also calling for additional measures, including tariffs on Chinese EVs and restrictions on certain Chinese-connected vehicle software. The issue gained further attention after approximately 2,900 Chinese-built EVs recently arrived in Canada and U.S. lawmakers introduced legislation aimed at preventing Chinese vehicles from entering the American market.
Source: Automotive News
