Medium- and heavy-duty truck tariffs were among the major sticking points in U.S.-Canada trade talks last week, which broke down Friday, ratcheting up trade tensions between the wo countries.

After talks fell through on Friday, President Trump imposed 50% tariffs on $20 billion of the country’s exports on Saturday. Canadian Prime Minister Mark Carney responded by saying the longtime allies were “at war” over trade and announced dollar-for-dollar retaliatory tariffs on American goods starting Sept. 8.

The two countries had appeared close to an agreement before negotiations collapsed late Friday. Although several issues remained unresolved, tariffs on medium- and heavy-duty vehicles were reportedly among the sticking points.

The escalating dispute also raises new questions about the future of the U.S.-Mexico-Canada Agreement, which governs trade among the three countries.

Trump Targets Canadian Auto Industry

On Monday, Trump said tariffs on Canadian “cars, trucks, both large and small,” automotive parts and steel would increase to 50% on January 1.

It was not immediately clear whether the reference to large trucks includes Class 8 commercial vehicles.

Medium- and heavy-duty trucks already are subject to a separate 25% Section 232 tariff imposed in 2025. That tariff explicitly covers Classes 3 through 8, although USMCA-compliant trucks receive special treatment based on their U.S. content.

Medium- and heavy-duty vehicles are specifically excluded from the new 50% tariffs on Canadian goods that took effect Aug. 22.

What Went Wrong?

Each side blamed the other for tanking last week’s deal.

According to reporting by Bloomberg, Reuters, and Politico, the talks collapsed in part over cutting U.S. tariffs on Canadian medium- and heavy-duty vehicles.

Under the deal negotiators were hammering out, the regular auto tariff would have been lowered to 15% from the current 25%. Canada wanted that relief expanded to medium- and heavy-duty vehicles.

Canada Trucking: Trade War Has Broader Effects Beyond Drop in Southbound Freight

The Canadian Trucking Alliance warned that a prolonged trade war could create problems for trucking on both sides of the border.

If Canadian exports to the U.S. decline, Canadian fleets will not only have fewer southbound loads. That also means fewer Canadian trucks will be in the U.S. and available to haul American goods northbound.

The result could be an equipment imbalance that makes cross-border freight harder and more expensive to move, according to the association.

CTA argues that trucking needs to be part of any government response to industries hurt by tariffs or declining trade. In past economic support programs, it said, trucking often was overlooked, even though carriers felt the effects when customers cut production and freight volumes fell.

The association's broader message is that trucking can’t be treated simply as a downstream casualty of a trade war. Because trucks connect manufacturers, suppliers, and customers across North America, disruptions to trade can quickly ripple through freight networks and carrier operations.