The Numbers Don't Lie

Sales at Jahn Engineering, a tool and die shop in Windsor, Ontario, are down nearly 70 percent. Dozens of workers have been laid off. The company's president, Louis Jahn, told The Washington Post he's been in the business 42 years and has never seen it this bad.

"We're just trying to stay alive."

How We Got Here

The North American auto industry didn't happen by accident. It was deliberately built through the 1965 U.S.-Canada Auto Pact, then expanded through NAFTA, then updated by the USMCA — a deal Trump himself signed in 2020 and called "the largest, fairest, most balanced, and modern trade agreement ever achieved."

Now he's calling it "irrelevant."

According to the Bank of Canada, the average U.S. tariff rate on Canadian products has jumped from 0.1 percent to 5.8 percent over the past year. That represents a significant shift in a supply chain that has operated as a single economic unit for six decades.

The Supply Chain Reality

The integrated nature of North American auto manufacturing means tariff pressure on Canada directly affects U.S. production. According to reporting from Automotive Manufacturing Solutions, Canadian-made vehicles contain 50 to 60 percent U.S. content — parts, raw materials, components. Canada has major engine plants that ship directly into Michigan and Ohio. Workers cross the border in both directions every single day.

U.S. Commerce Secretary Howard Lutnick reportedly told a Toronto conference that the Trump administration "does not want automotive manufacturing in Canada." He later called the existing framework "bad industrial policy" at the Semafor World Economy summit in Washington, per Bloomberg.

That statement is sending shockwaves through a $35 billion industry.

What the Big Automakers Have Already Done

Decisions are already being made.

Stellantis has postponed the electric Jeep Compass and Charger. GM has stopped production of its Bright Drop electric vans. Ford has cancelled EVs destined for Canadian production, though it will still build ICE-powered F-Series Super Duty trucks there, according to Automotive Manufacturing Solutions.

These aren't reversible overnight. Tooling, supply contracts, workforce planning — once you pull the plug on a vehicle program, the process of restarting is lengthy and uncertain.

The USMCA Review Is Coming — And Policy Direction Remains Unclear

The official USMCA review is scheduled for July 1. Trump's actual negotiating position, however, remains undefined.

According to Dealership Guy, U.S. officials have floated proposals requiring imported vehicles to include a minimum share of U.S.-made components. Another proposal would limit automakers' ability to reduce tariff liabilities under USMCA. Both would raise costs and complicate the cross-border production model that currently keeps prices down for American consumers.

Trump has also mused publicly about scrapping the trilateral USMCA entirely in favor of separate bilateral deals — one with Canada, one with Mexico. Whether that's a negotiating tactic or an actual plan, industry officials express uncertainty. That uncertainty alone is limiting investment.

Canada Is Organizing — But the Players Have Shifted

In a notable development reported by Dealership Guy, the newly formed Pacific Manufacturing Association of Canada (PMAC) is stepping up ahead of the review. PMAC represents Toyota and Honda, which together accounted for 77 percent of vehicles built in Canada in 2025.

The two companies producing the lion's share of Canadian vehicles are Japanese-owned, not the Big Three Detroit automakers who built that industry.

PMAC CEO Brendan Sweeney told Wards Auto: "We're all wanting a trade deal with the USA... We're optimistic, but we're realistic that we're going to get something done, but it won't be easy."

Ford, GM, and Stellantis — the American brands with deep Canadian roots — are largely on the defensive, cutting programs rather than lobbying hard for their northern operations.

Context Worth Noting

The Big Three have been pulling back from Canada for years — EV delays and program cancellations predate much of the recent tariff pressure. Trump's policies have accelerated a retreat that was already underway.

Also relevant: Prime Minister Mark Carney's decision to allow 49,000 Chinese electric vehicles into Canada. Trump administration officials have cited this as a legitimate grievance driving trade pressure. Whether a 100 percent tariff threat is proportionate to that decision is a separate question.

The Stakes for Workers and Consumers

For those who work in auto manufacturing in Michigan, Ohio, Indiana, or Ontario, the USMCA review scheduled for July matters significantly.

A botched renegotiation doesn't just mean Canadian job losses. It means disrupted supply chains, higher vehicle prices, and potential production shutdowns on the American side of the border too.

The integrated North American auto economy is the practical reality of how cars get built and what they cost. A major restructuring without operational planning creates risk for workers and consumers on both sides of the border.

Louis Jahn is trying to keep his business open. So is an industrial model that's worked for 60 years. The clock to July 1 is ticking.