A source familiar with the matter said that the U.S., besides Canada, is closing in on a revised trade deal. Washington may cut some contentious tariff rates on Canadian-built cars and trucks, as well as on key metals.
U.S. President Donald Trump had threatened a new batch of tariffs on Canadian imports. They were to commence on Wednesday, 19 August. However, citing progress on talks, pushing back the date by 3 days to Saturday, 22 August.
Trump told reporters that the U.S. might have a deal with Canada. Canadian Prime Minister Mark Carney said on X that the two sides were moving towards an agreement.
Until a deal’s formally reached, negotiators face a deadline of 12:01 hrs EDT (04:01 GMT). That’s when tariffs on USD 20 billion worth of Canadian goods are scheduled to come into effect.
Late on Wednesday, 19 August, the U.S. State Department said that U.S. Secretary of State Marco Rubio may meet Canada’s Foreign Minister, Anita Anand, at the White House on Thursday, 20 August.
Auto tariffs reduced to 15%
The source said that the proposed deal was expected to cut top-line tariff rates by 10% on Canadian-built cars & trucks to 15% from the existing 25%. Industry executives opined that rate threatens to kill Canadian auto manufacturing.
2 auto executives said that Canada was pushing to reduce the tariff to 10%.
The 15% top-line auto tariff may also come before deductions for the value of U.S.-produced content. The source told Reuters that the change brings the effective rate substantially lower. The source also added that the proposed deal may also have the top-line tariff rates on Canadian steel & aluminium at 25%.
2 industry sources familiar with the deal added that these lower steel tariffs may apply only to certain import volumes under a quota arrangement. One of the sources said that the quota may likely be set at 4 million metric tonnes annually. Any imports above that level may be subject to the original 50% steel tariff.
