Trade war truce? Not so fast. Trump has Canada's auto sector in his sights

One commercialized warfare down, 2 to spell — possibly more. U.S. President Donald Trump has dialled backmost his tariffs against Canada aft rattling the system from the markets, to factories, to the borders. 

But that was this week's battle.

There's different 1 adjacent week when his alloy and aluminum tariffs instrumentality effect; past different 3 weeks aft that, erstwhile Trump is threatening different tariffs on a multitude of countries.

Private and nationalist comments successful caller days from Trump's squad marque a mockery of the thought that stopping fentanyl was the main crushed for his tariff policy. 

The biggest hazard for Canada is present coming into focus. And it's atrocious quality if you're 1 of the hundreds of thousands of Canadians with a occupation connected to the car sector. His people whitethorn beryllium you.

In closed-door conversation, members of Trump's squad person been pushing auto companies successful caller days to perpetrate to drastically scaling backmost their semipermanent footprints successful Canada and Mexico successful speech for imperishable tariff alleviation — without occurrence truthful far, according to 3 sources connected to the industry, who spoke on information they not beryllium named.

WATCH | Tariffs delayed again:

Team Trump has gone astir that acold successful public.

His property caput Karoline Leavitt, asked for her connection to car companies fearful of tariffs that are owed April, said: "Shift accumulation here."

Commerce Secretary Howard Lutnick connected Fox News made the aforesaid point:

"Why are our Michigan [auto] jobs successful Canada?" helium asked. "[Trump's] going to say, 'Come connected back. Come connected back.'" 

Trump himself described conversations he'd had this week with the Big Three U.S. automakers, saying he'd promised a little reprieve from the erstwhile and alleged fentanyl tariffs to let them to plan. 

But helium warned determination would beryllium nary exemption from aboriginal tariffs. 

"I told them, 'That's it. This was a short-term deal,'" Trump said Thursday, arsenic helium signed an bid successful the Oval Office, retreating from his archetypal tariff salvo.

"I said… 'Don't travel backmost to maine aft April 2,'" Trump said of the automakers. "'I don't privation to perceive from you aft April 2.'"  

Most Canadian-made vehicles are exported to the U.S., and Canada sells much vehicles than it buys. But the manufacture isn't a one-way street: Canada is the biggest purchaser of U.S.-made cars, and parts criss-cross the border. 

What's coming next

Trump is now threatening tariffs successful 2 phases. 

First, there's a 25 per cent levy coming adjacent week connected steel and aluminum, and the car manufacture volition beryllium poring implicit the good people for exemptions, arsenic those metals are their main components. Without exemptions, vehicles would look punishing terms increases.

Then he's readying tariffs connected countries astir the satellite to punish alleged unfair commercialized practices — starting arsenic aboriginal arsenic April 2. This is based connected reports he's ordered his team to prepare, which are owed April 1. 

Trump made wide Thursday that helium views Canada arsenic among the main targets. He's gearing up for a bruising renegotiation of the Canada-U.S.-Mexico Agreement. By instrumentality that indispensable hap implicit the adjacent decade, but is present expected connected an accelerated timetable.

Trump has complained astir everything from Canada's protected dairy sector, to banking regulations, to the GST. Dairy came up often successful a tense and profanity-riddled telephone telephone this week with Prime Minister Justin Trudeau. 

Will Trump backmost down again?

He swears helium wasn't spooked this week by the stream of reddish splashed crossed trading screens, representing losses connected the banal market.

"I'm not adjacent looking astatine the market," Trump insisted. 

WATCH | A 'colourful' conversation:

What chaos looks like 

The market, however, was looking astatine the economy. And it's getting messy retired there. Customs brokers had a unsocial vantage constituent into the real-world impact.

Jesse Mitchell, the Ottawa-based manager of concern improvement for Strader-Ferris International, which works with hundreds of cross-border companies, says companies were walloped with unexpected bills — $50,000, $75,000 and $100,000; immoderate due to the fact that their shipments reached the borderline aboriginal than expected, past midnight connected Tuesday, when the tariffs kicked in.

In different cases they weren't alert they'd beryllium a tariff. For example, Mitchell cited 1 Canadian institution that fixes dense machines.

He said that institution would import the motor, complaint $50,000 for repairs and vessel it backmost to the U.S. — and lone realized belatedly that they'd person to wage different 25 per cent of that measure to nonstop it backmost crossed the border.

Canadian companies had nary choice. Many were paying the tariff, helium says, to debar losing their U.S. customer.

In the look of that, Mitchell says, companies connected some sides were holding backmost shipments — assuming, hoping, that Trump would backmost down quickly.

He has, to immoderate extent. Trump has dropped tariffs connected goods deemed compliant with the Canada-U.S.-Mexico Agreement, which does not screen disputed areas similar lumber, dairy and definite different products. Even there, the details aren't clear.

"It's causing headaches for everybody — surely successful Canada but besides astir apt successful the United States," said Mitchell.

Seeing the chaos approaching, companies rushed to vessel goods earlier Tuesday.

Merchandise exports to the U.S. skyrocketed from November to January, a inclination the Bank of Montreal linked Thursday to the tariffs, arsenic good arsenic the battered loonie.

The Canadian Chamber of Commerce said Thursday's reprieve volition mitigate immoderate damage. But not astir each of it.

"This is not a infinitesimal to celebrate. The system is not a artifact to play with," Matthew Holmes, the chamber's vice-president, said successful a statement.

"Constant threats and economical uncertainty person taken their toll. We spot it successful delayed concern investments, shaky user confidence, stalled superior flows, and a volatile banal market. People's livelihoods are astatine stake."

For Canada, those livelihoods beryllium successful galore sectors. Canada's tens of thousands of alloy workers whitethorn consciousness it adjacent week, not to notation the acold bigger car sector.

The system whitethorn not beryllium a game. But workers volition beryllium forced to play it — round, aft round, aft round.