People can argue that the US President’s recent attack on the Canadian economy by implementing 25% tariffs is strewn with misinformation and bad policy, or they can think it is wonderful American nationalism. We are not going to engage in that opinion discussion, but will outline the core tenants of trade that even the simplest mind can understand and appreciate.
The idea behind the Auto-Pact (which became the North American Free Trade Agreement, which became USMCA) is that each country produces roughly the number of vehicles that is sold in its country. So it doesn’t make much difference if some Buick’s are manufactured in Fairfax Kansas, and some Chevrolet’s are manufactured in Oshawa Ontario, as long as the number we sell roughly equates to what each country manufactures.
Take a look at these numbers and tell me what is wrong with them:
Manufacturer | Passenger Vehicles SOLD in Canada (2023) | Passenger Vehicles MADE in Canada (2023) |
Ford, Lincoln | 240,000 | 210,000 |
General Motors (GM) | 263,084 | 150,000 |
Stellantis (Dodge, Jeep…) | 158,237 | 250,000 |
Tesla | 35,000 | 0 |
TOTAL | 696,321 | 610,000 |

As you can plainly see, there is absolutely no question that Canada buys more American vehicles than it produces, so the US President is correct about a trade imbalance in autos, but he’s off by about 9% in the wrong direction.
60 years ago, when the Auto Pact was first signed, it might have been true that Canadians would be forced to buy American vehicles no matter where their manufactured because the American Big Three were the only ones making passenger vehicles at scale. However, today nobody is going to argue that the Japanese, Koreans, Europeans and Chinese don’t provide very compelling vehicles that are readily available to the Canadian market.
One of the arguments the Canadian government is making in this trade dispute, is that Canadians should buy Canadian and while that’s obviously the great preference, it’s just not very practical for many products from grapes to Cadillac’s. We think the argument the Canadian government should be making to its citizens is to not so much buy Canadian as it is to just not buy US made products.

Personally I was seriously considering a Cadillac Lyriq, and had pretty much bought one a few weeks ago. The Lyriq is a great EV, but it is made in Spring Field Tennasse, so that is out! I am now looking at Mexican and Korean manufactured EV’s. At the top of my list today is the Cadillac Optiq which is made in GM’s Ramos Arizpe plant in Mexico. I drove it yesterday and it was great!
Put simply: don’t say buy Canadian, just say bye American.
Auto Pact Brief:
If you produce what you are good at, I produce what I am good at, and then we trade, we can both have increased sales and decreased costs, thereby notably increasing the standard of living for both.
The Canada–United States Automotive Products Agreement, commonly known as the “Auto Pact”, was signed on January 16, 1965, by Prime Minister Lester B. Pearson and President Lyndon B. Johnson. This agreement aimed to integrate the Canadian and U.S. auto industries into a shared North American market.
It was seen as a crucial part of the solution to Canada’s economic challenges. Canada was running a persistent automotive trade deficit with the United States in finished vehicles and in auto parts at the time.
The agreement succeeded in leading to significant benefits for both countries, lowering auto prices on both sides of the boarder, increasing automobile production in both the US and Canada, creating thousands of middle class jobs, and increasing wages.
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