US-Canada trade war escalates as Trump threatens tariff hike on vehicles

US-Canada trade war escalates as Trump threatens tariff hike on vehicles

Trump said on Monday that he will increase tariffs on Canadian cars and trucks, as well as auto parts, from 25% to 50% as of 1 January.

It comes after US-Canada trade talks collapsed late last week, with each side accusing the other of making unreasonable last-minute demands.

Prime Minister Mark Carney called Trump's latest levy threat unsurprising and accused the president of wanting to destroy Canada's auto industry. He added that Canada is ready to resume talks only if the US comes with the 'right attitude'.

The war of words followed several US and Canadian officials saying that talks were suspended with no set date to resume.

Canada walked away from trade negotiations late on Friday night, moments before a US-imposed deadline that would add a 50% levy on nearly $20bn (C$28bn; £14bn) of Canadian imports.

The collapse in talks marked a significant change in tone from earlier in the week, when both sides appeared optimistic that a new US-Canada trade deal could be reached.

Watch: Canada will negotiate if US has the 'right attitude', says Mark Carney

Canadian officials have said the US introduced last-minute demands that were 'unacceptable', including a clause limiting which countries Canada could sign trade deals with.

US officials, meanwhile, said it was Canada that introduced last-minute changes.

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EXISTING ARTICLE (213 words / 9 paragraphs):

• US-Canada trade war escalates as Trump threatens tariff hike on vehicles
• Trump said on Monday that he will increase tariffs on Canadian cars and trucks, as well as auto parts, from 25% to 50% as of 1 January.
• It comes after US-Canada trade talks collapsed late last week, with each side accusing the other of making unreasonable last-minute demands.
• Prime Minister Mark Carney called Trump's