Higher tariffs on Canadian imports would be 'catastrophic,' Honda exec says

What happened

A Honda public affairs executive said a pending increase in US tariffs on steel and auto imports from Canada starting January 1 would be catastrophic for the industry, and that automakers hope the US, Mexico and Canada extend their trade deal.

Confirmed

Global impact / market context

Higher tariffs would raise costs for automakers that move parts and vehicles across North American borders. For Honda, that could shrink profit per sale and influence where it builds new plants, because the three countries' auto industries are tightly intertwined.

Analyst inference

The auto industry has faced US tariffs since early 2025 on imports from several countries, including Mexico and Canada. The US and Canada are discussing a deal to ease tariffs on Canadian steel and autos, which keeps trade policy as a key uncertainty for carmakers.

Analyst inference

What to watch

1. Watch whether the US, Mexico and Canada extend their longstanding trade deal, which Honda says is integral to keeping the US auto industry competitive. Confirmed
2. Watch for a US-Canada deal to ease US tariffs on Canadian steel and autos, which Reuters reported the two countries are working on. Proposed
3. Watch whether the January 1 tariff increase takes effect, since Honda calls it catastrophic and expects cooler heads to prevail and avoid the doubling. Analyst inference

Evidence

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