Canada imported more cars from Mexico than from the U.S. for the first time in 30 years
According to Statistics Canada, Canadian importers imported C$1.08 billion ($784 million) worth of passenger cars from Mexico in June, compared to C$950 million from the U.S. This is the first time since the early 1990s that the Mexican auto sector has surpassed the U.S. on this measure.
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As Bloomberg reports, the tipping point in the trade balance was the result of the 25 per cent duties on foreign cars imposed by the Donald Trump administration. The multi-year scheme of free movement of cars and components between the US, Canada and Mexico was broken. For cars shipped under the USMCA agreement, duty is levied only on the share produced outside the US, but this concession did little to smooth the conflict.
In response, Canada imposed symmetrical tariffs on US-assembled cars, while maintaining benefits for companies that continue to invest and manufacture in the country.
The shift in import patterns could be a marker of how the U.S. tariff policy will change the auto industry, as Canada is the largest buyer of U.S. passenger cars and pickup trucks. According to the U.S. Department of Commerce, the U.S. had a surplus in auto trade with Canada in 2024, including the auto parts sector. U.S. exports of finished vehicles to Canada exceeded exports to Germany, Mexico and China combined.
Traditionally, automobile manufacturers such as General Motors and Ford have supplied Canada with American-built vehicles. Now Ford is not producing anything at its only Canadian plant in Ontario, but promises to start production of F-Series Super Duty pickup trucks there next year.
Mexico's lead may be short-lived, however: in February and March, Canadian car imports from the U.S. were unusually high, averaging C$2.5 billion a month, as automakers rushed to ship cars before duties were imposed. By comparison, last year's monthly average was barely more than 1.8 billion.
Major automakers have largely refrained from raising prices on a large scale to offset the cost increases caused by the duties. Instead, they have shifted some production to the U.S. or changed supply chains to sell cars made in America to U.S. buyers.
Source: Bloomberg