Trump is said to push for an early restart of the North American trade agreement
The Trump administration intends to push for renegotiation of the U.S. trade deals with Canada and Mexico ahead of a review in 2026, people familiar with the matter said, seeking to shore up U.S. auto industry employment and counter Chinese companies that are making inroads into Mexico’s auto industry.
The United States-Mexico-Canada Agreement signed by Trump in 2020 requires the three countries to conduct a “joint review” of the agreement six years later on July 1, 2026. The talks were to discuss plans that have not yet been made public, said the people, who spoke on condition of anonymity.
They say Trump officials are particularly interested in tightening the deal’s rules governing the auto industry to prevent auto plants from leaving the United States. They are also trying to prevent Chinese companies that make cars and auto parts from exporting to the United States through Mexican factories.
Trump has also threatened to impose 25% tariffs on products from Canada and Mexico, saying these countries allow drugs and immigrants to flow across their borders. Speaking in the Oval Office after taking office Monday night, he said he planned to move forward with tariffs on February 1.
Members of Trump’s team believe Mexico has been violating the terms of a separate agreement restricting metal exports to the United States, and they are eager to make clear to the Mexican government that they intend to take action against such trade violations, a person familiar with the matter said. .
The Wall Street Journal reported earlier that Trump was pushing for an early renegotiation of his North American trade agreement. The three countries must meet to discuss the terms of a trade deal six years after the agreement takes effect, but trade experts expect the Trump team to speed up work on the issue.
Mexico and Canada initially insisted on revisiting the terms of the deal after six years because they believed it would enable them to elect a second consecutive Trump administration, a person familiar with the matter said. Instead, the demand for talks in 2026 will fall squarely into Trump’s hands.
Trump has long criticized the previous trade agreement, NAFTA, and his officials negotiated a new deal to replace and update it. One of the major changes in the agreement is to raise the threshold for vehicle content that needs to be produced in North America to qualify for zero tariffs. The deal also includes other provisions requiring automakers to use more North American metals and higher-paid workers.
But Trump and his advisers now believe the provisions are not restrictive enough to prevent automakers from moving factories outside the United States. They are also wary of Mexico’s massive imports of cheap, high-quality Chinese cars and China’s efforts to set up auto factories in Mexico.
In October, Trump said in a speech at the Economic Club of Detroit that “Mexico is becoming the second China.”
“When China comes in, they take over everything and you don’t have car manufacturing anymore,” he added.
People familiar with the plans warned they could still change. It remains to be seen whether Trump threatens to impose tariffs on Canada and Mexico as a negotiating tactic to force certain concessions from both governments, or simply imposes those concessions directly. The Trump administration press office did not immediately respond to a request for comment.
Trump signed an executive order Monday night directing agencies to study various trade issues. He stopped short of imposing any new tariffs immediately as he had previously threatened, but the order raised the possibility of a series of trade actions in the coming months.
A provision in the order directs trade officials to assess the impact of the North American trade deal on workers, farmers and other businesses and “make recommendations regarding U.S. participation in the agreement.” It also directs them to begin soliciting public comments in preparation for a review of the trade deal in July 2026.
