US-Canada trade war deepens as Trump threatens auto tariff hike

President Donald Trump threatened to raise US tariffs on Canadian automobiles from 25% to 50% starting January 1, escalating the trade war between the neighbors. The threat follows the collapse of US-Canada trade talks late last week. Prime Minister Mark Carney accused Trump of wanting to "destroy" Canada's auto industry and said he would only resume talks if the US comes with the "right attitude". Canadian officials cited unacceptable last-minute US demands, while US trade representative Jamieson Greer blamed Canada for introducing changes. The breakdown threatens the USMCA pact underpinning $1.6tn in North American trade, with experts warning a dismantling could plunge Canada into recession. Ontario premier Doug Ford suggested charging the US extra for oil and gas, while Canada announced C$11bn for new icebreakers to diversify trade.