We’re better off as teammates than competitors.
That’s the message from Canadian auto industry insiders after U.S. President Donald Trump told Prime Minister Mark Carney Tuesday during an Oval Office sit-down that both countries are battling for manufacturing jobs.
The head of the Big Three Detroit automakers association in Canada said that Trump’s approach has led to higher prices for consumers and giving up global market share to China.
“We’ve spent the better part of the last 60 years building a highly integrated North American automotive industry which has made the sector highly competitive,” said Brian Kingston, CEO of the Canadian Vehicle Manufacturers Association. “You cannot unwind that overnight without doing massive economic damage to the United States, Canada, and Mexico.”
Trump’s tariffs on automotive imports, including from Canada and Mexico, raise costs for the entire North American automotive industry when it’s in a desperate struggle to compete against Chinese manufacturers, especially in the electric vehicle market, said Kingston.
“If the United States is fighting with its strongest partner and ally in Canada,” says Kingston, “we do not stand a chance against China in this pivot to electrification.
“We’d better start working together, or we will be blocked out of markets around the world.”
Canada’s auto parts manufacturing association head agreed that the auto industry will suffer if Trump keeps trying to undo the contintent-wide automotive alliance.
“It can’t function if we disintegrate it,” said Flavio Volpe, CEO of the Automotive Parts Manufacturers Association. “He’ll sink Detroit before he sinks Shanghai.”
Manufacturers like Ford, GM and Stellantis count on the highly-integrated North American automotive supply chain, Volpe said, with raw materials and parts often crossing the Canada-U.S. and U.S.-Mexico borders up to seven times en route to becoming a finished vehicle.
“You’re taking aim at Canada but you’d be naïve to think that Ford, GM or Stellantis aren’t getting hurt as well,” said Volpe, who also took issue with Trump’s claim that Detroit “emptied out” because of Canada. “Everyone knows those statements have no relationship with the truth.”
“The problem we have is that they want a car company, and I want a car company,” Trump said during the White House press conference with Carney. “We don’t like to compete because we sort of hurt each other when we compete, and so we have a natural conflict. It’s a natural business conflict.”
Still, Volpe felt that some of Trump’s rhetoric was the U.S. president’s way of signalling that real negotiations can start.
“I’m not as worried as some other people who heard about Canadian cars and think it’s the end of world. I think it’s the beginning of negotiations,” said Volpe. “This way, he can talk about a deal being done with a formidable opponent.”
Trump also claimed he wants Canada’s auto sector to do well.
“We want to make our cars here. At the same time, we want Canada to do well, making cars,” Trump said. “So, we’re working on formulas and I think we’ll get there.”
