Susanna Riva The trade conflict between the United States and Canada has returned to the forefront after a brief summer lull. The Trump administration imposed a 50% tariff on approximately $20 billion in Canadian products in 2025, primarily targeting autos, steel, and alcohol. Canada responded with similar countermeasures, creating a spiral of mutual pressure that has already impacted consumer prices in both countries.
With the US midterm elections just days away on October 27, 2026, the issue has returned to the center of political debate, fueling attacks from both sides but also pushing for a possible reopening of negotiations.
Commercial dialogue rekindled after the October 21 phone call
The turning point was the telephone conversation between President Donald Trump and Canadian Prime Minister Mark Carney, which took place on October 21.
Since then, U.S. Commerce Secretary Howard Lutnick and Canadian Trade Minister Dominic LeBlanc have exchanged numerous messages, according to insiders who requested anonymity. The conversations have focused on tariffs on autos and steel , issues that have long been at the heart of the dispute. Carney has called this phase a " petit intensification ," implying a small but significant increase in negotiating intensity.
Tariffs on cars, heavy trucks and tied sectors
The most sensitive issue remains the request for tariff reductions on light and heavy vehicles . Washington has maintained a rigid stance on the truck sector, largely produced in Ontario, while Ottawa is pushing for lower tariffs on cars and steel . Lutnick, already a key player in similar agreements with the European Union and Japan, appears willing to grant reductions only if accompanied by major production investments in the United States. The parties have not yet reached a formal agreement, and the basic demands—reductions in Canadian tariffs and greater access to the Canadian market for alcohol and dairy products—remain under discussion.
Political pressures and electoral context
The renewed diplomatic fervor coincides with concerns among Republicans in border regions. Senators like Bernie Moreno (R-Ohio) and Senate candidates in Michigan and Maine have criticized the situation, denouncing the negative impact of tariffs on local consumers. President Trump, during a rally in Michigan, assured that the conflict "will be resolved soon," hoping to provide relief to state economies before the elections. However, Carney appears unwilling to make political concessions, having recently welcomed a visit by European Union leaders to Montreal to strengthen alliances outside the North American context.
Reactions from businesses and lobby groups
U.S. industry associations, including Century Aluminum President Jesse Gary, met with Commerce and USTR officials to defend the status quo of tariffs. Gary emphasized that the current measures "are working" and that any changes should be accompanied by investment guarantees. In Canada, automotive companies continue to demand more favorable terms, arguing that the current tariffs hinder global competitiveness. Despite internal pressure, both administrations reiterated that the relationship "is very good" and that "there is no change of pace."
Negotiations between the United States and Canada have entered a phase of limited intensification , but key sticking points—tariffs on autos, steel, and access to agricultural markets—remain unresolved. With the U.S. election looming and the upcoming brief European visit to Ottawa, the parties may try to find common ground, but any progress appears to depend on a broader renegotiation of long-term trade terms.