Article Summary
Major U.S. automotive industry associations are calling for swift renewal of the USMCA trade agreement after the U.S. government declined to renew it in its current form, warning that the deal's collapse could jeopardize billions in U.S. manufacturing investment and thousands of jobs.
- Eight major U.S. automotive associations, including the Alliance for Automotive Innovation and MEMA, jointly urged leaders to extend USMCA with preferential treatment for qualifying goods
- The USMCA has generated billions in U.S. production investment and created thousands of manufacturing jobs since entering force on July 1, 2020
- The U.S. Trade Representative stated the United States did not agree to renew USMCA in its current form, though the agreement remains in force during negotiations
- Canada and Mexico both expressed support for renewal, with Mexican President Claudia Sheinbaum emphasizing the importance of maintaining the treaty through 2036
- Industry leaders prioritize restoring tariff-free auto trade to reduce uncertainty and maintain the trilateral partnership that has enabled consumer choice and affordability
Several automotive industry associations are calling for renewed trade stability after the U.S. government declined to renew CUSMA in its current form.
A joint statement from U.S. automotive associations called USMCA “a success story for the entire U.S. auto industry.”
“The USMCA is a success story for the entire U.S. auto industry, with billions invested in U.S. production and thousands of manufacturing jobs created since the agreement entered into force. It has also been a success story for American consumers, allowing U.S. automakers to provide families with a wide variety of vehicle choices that fit every budget."
The statement was issued by the Alliance for Automotive Innovation, the American Automotive Policy Council, the American International Automobile Dealers Association, Autos Drive America, MEMA, The Vehicle Suppliers Association, the National Automobile Dealers Association and the Zero Emission Transportation Association.
The groups urged Canada, the United States and Mexico “to swiftly reach consensus on an extension of USMCA.”
"We urge the leaders of the U.S., Canada, and Mexico to swiftly reach consensus on an extension of USMCA that preserves the existing trilateral partnership, returns to preferential treatment for qualifying goods, and continues the stability and predictability that has helped the industry thrive for the past six years."
Global Automakers of Canada, a Markham, Ont.-based association representing international automakers in Canada, also called for renewed tariff-free auto trade.
“A return to tariff-free auto trade is essential,” said Lucas Malinowski, president and chief executive officer of Global Automakers of Canada.
Malinowski said the priority should be to “reduce uncertainty, restore confidence” and keep the CUSMA/USMCA framework in place.
CUSMA is the Canada-United States-Mexico Agreement. It is known as USMCA in the United States and T-MEC in Mexico. It replaced the North American Free Trade Agreement, or NAFTA, and came into force on July 1, 2020.
The three countries met virtually on July 1 for the agreement’s first formal joint review. In a statement issued by U.S. Trade Representative Jamieson Greer, the office stated that the United States “did not agree to renew the USMCA in its current form.”
The USTR statement also said the agreement “remains in force” while talks continue.
Prime Minister Mark Carney said before the meeting that he did not expect a completed agreement on July 1. “We’re expecting a constructive exchange,” Carney told reporters in a media scrum. “I wouldn’t expect any drama tomorrow.”
Dominic LeBlanc, Canada’s minister responsible for Canada-U.S. trade, said after the meeting that Canada still supports renewal.
Mexican President Claudia Sheinbaum also said the agreement remains in place. “It is very important that the treaty remains in place until 2036."
