Prime Minister Mark Carney said Canada is still working on options to retaliate against US President Donald Trump’s new tariffs on Canadian goods, while adding that he is prepared to continue trade talks if Washington changes its stance.
Speaking at a news conference in Quebec on Monday, Carney said he was continuing discussions with US negotiators. He added that there is a mutually beneficial deal possible, but only on terms Canada considers fair.
US Plans more Auto Tariffs From January
The discussions with U.S. negotiators revealed that Trump wants to destroy Canada’s major industries — steel, aluminum and autos — with unfair terms, Carney said.
Carney told reporters that the government is aiming for a settlement that respects Canada’s sovereignty and independence and uses the countries’ complementary strengths rather than breaking up industries for short-term gain.
His remarks came hours after Trump said he would raise tariffs on Canadian-made autos to 50 per cent from 1 January. Trump also said auto parts would face tariffs, reversing the current approach.
At present, the 25 per cent tariff applies only to non-US content within finished vehicles, while auto parts crossing the border remain tariff-free.
The warning came after the Trump administration imposed 50 per cent tariffs on about US$20 billion worth of Canadian exports from Saturday morning. The measures cover products including furniture, plastics, plywood and electrical equipment.
The two sides had held talks aimed at preventing the new levies, but negotiations ended on Friday, with each side blaming the other for the breakdown.
Canada’s Counter-Tariffs and Possible Targets
Carney said his government has pledged to respond with counter-tariffs by 8 September, covering American steel, dairy, appliances, agricultural equipment, electronics and pulp and paper. He said officials are still preparing the detailed list of goods.
He also said the government will provide support for industries affected by the new US duties.
Carney argued that the negotiation approach was unacceptable, saying Canada would not accept terms that treat Canadian industry as subordinate to the US or that create ongoing disadvantages compared with US producers.
While Canada is considering retaliation, Carney said he preferred to try “positive” steps first, including building new coast guard vessels using Canadian steel, which he announced with Quebec’s premier.
He said the government is examining a range of options and did not rule out measures involving critical minerals, energy or other exports to the US.
“The strategic and symbolic scope of reprisals are very important,” Carney said, adding that Canada would seek action “where there’s sensitivity”. He acknowledged that matching the US dollar-for-dollar would be difficult given the size of the American economy, suggesting Canada’s response may need to be more targeted.
Negotiations, Social Media Pressure and Sector Fallout
Carney previously said talks collapsed for several reasons. Negotiators discussed reducing US auto tariffs to 15 per cent, but the US would not extend the relief to medium- to heavy-duty trucks, including vehicles produced at Ford Motor Co.’s plant in suburban Toronto.
He also said the US pushed to limit Canada’s ability to strike trade deals with other countries and made demands relating to cultural and French-language issues that Canada rejected.
While Carney was speaking, Trump again posted on social media, referring to Carney as “governor” and criticising Ontario Premier Doug Ford, warning of consequences for Canada.
The US trade representative, Jamieson Greer, said Canada made late demands that overturned the draft agreement. Greer said the proposal would have cut tariffs on autos, steel, aluminium and lumber and set cooperation on export controls, digital trade and joint tariffs. It would also have started formal talks to renew the Canada-US-Mexico Agreement (CUSMA), which Trump negotiated in his first term but declined to renew this year.
Parts of Canada’s economy have already been hit by losses and layoffs linked to earlier sectoral tariffs, including Ontario auto plants and steel mills. Some smaller manufacturers had been protected earlier because US exemptions applied to goods shipped under CUSMA, but the new 50 per cent levies—ordered under a rarely used 1930 Tariff Act provision—do not follow that framework.
Carney said that if Trump follows through with 50 per cent auto tariffs, the move would disrupt supply chains that have connected the two countries’ auto sectors for decades.
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25 August 2026
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