The U.S.-Canada trade war is creating a headache for auto-parts makers

A truck passes over the Peace Bridge between Canada and the United States, in Fort Erie, Ontario, on August 18, 2026. Cole Burston/AFP via Getty Images hide caption toggle caption Cole Burston/AFP via Getty Images Stay up to date with our Up First newsletter, sent every weekday morning. The U.S. and Canadian auto industries have been tightly woven together for decades. But the latest tariff flareup between the two countries may complicate that. Think of that sticker on the windows of new cars breaking down how much of the vehicle's content comes from the U.S. and Canada. From a manufacturing point of view, content from both places has long been considered deeply intertwined. But the U.S. and Canada failed to reach a new trade deal this summer, and the trade war between them has escalated quickly. In August, the U.S. enacted new tariffs on aluminum and steel, and President Trump has also threatened 50% tariffs on Canadian vehicles, auto parts and steel effective on Jan. 1. On Tuesday, Canada enacted retaliatory tariffs on a variety of U.S. goods — including on American steel and aluminum. All of this puts the auto manufacturing industry in a jam. For major U.S. carmakers, analysts s...