Trump tariff threat on Canadian-built cars: These models could be affected
29 August 2018 - Autoblog
It would be especially bad for Chrysler brands
Some progress has been made in developing new trade rules for North America, but at the time of writing, the rules have only been agreed to by the U.S. and Mexico. Canada has yet to come to an agreement. And this means that President Trump has resorted to his favorite trade-war weapon, threats of tariffs. The latest threat, if Canada doesn't come to an agreement on a three-way replacement for NAFTA, is to put a tariff on Canadian-built cars.
That got us wondering, just what cars would be affected by said tariff? It could be a wide range of vehicles, depending on what "Canadian-built" would mean, whether it's just cars that are assembled in Canada, or Canadian-built auto parts. Because of the complexity of figuring out what cars use what amount of parts specifically from Canada (since NHTSA lists parts content as "U.S./Canada"), we're going to go with the simpler idea of just final assembly point. The list of U.S.-market cars assembled in Canada is below. Vehicles that are manufactured in Canada, but also in other countries, have their other assembly locations listed.
- Chrysler 300
- Chrysler Pacifica
- Dodge Challenger
- Dodge Charger
- Dodge Grand Caravan
- Ford Edge
- Ford Flex
- Lincoln MKT
- Lincoln MKX
- Cadillac XTS
- Chevrolet Equinox (also Mexico)
- Honda Civic Coupe (also U.S.)
- Honda Civic Sedan (also U.S.)
- Honda CR-V (also U.S.)
- Lexus RX350 (also Japan)
- Lexus RX450h
- Toyota Corolla (also U.S.)
- Toyota RAV4 (also Japan)
As you can see, the company that would hurt the most from these tariffs is Fiat-Chrysler, specifically the Dodge and Chrysler brands. The only two models Chrysler sells would be hit, and three of the five current Dodge models would also be affected, including the bestselling Caravan model (yes, we're as surprised as you are). There are a few other significant sellers here, too, such as the Ford Edge, Chevy Equinox, Honda Civic, Honda CR-V, Lexus RX, Toyota Corolla and Toyota RAV4. Fortunately for all but the Edge, those models are also manufactured in other countries. That could help mitigate some of the extra cost added to some examples. These other automakers also have large lineups of vehicles built outside of Canada to help ease the blow.
Of course this may all be moot if Canada and the U.S. reach a deal on trade. It could also end up being much more complicated and costly for more companies if the tariffs affect components, too. But this is certainly a possible outcome if no deal is made, and it could be quite costly for FCA and a major annoyance for other automakers.