Driven in part by a steep drop in auto shipments to the United States after President Trump imposed steep tariffs, Canada posted a record trade deficit of 7.1 billion Canadian dollars, about $5.2 billion, in April.
Exports to the United States, Canada’s largest market, were hard hit after the president began his trade war with Canada, declining by 15.7 percent since March, according to data by Statistics Canada, the national census and economic data agency, released on Thursday.
Mr. Trump imposed a 25 percent tariff on autos in April and introduced a similar levy on auto parts, although he has since suspended that tariff.
This week, Mr. Trump doubled tariffs on steel and aluminum from Canada and most of the world to 50 percent from 25 percent.
Canada’s economy is heavily dependent on trade, and last year about 75 percent of its exports were sent to the United States.
Prime Minister Mark Carney of Canada has framed the trade war Mr. Trump started as a crisis for Canada and made shifting the country away from its reliance on the United States a cornerstone of his leadership.
The tariffs have effectively torn up the broad free-trade agreements between the two nations that date to 1989. Mr. Carney on Wednesday characterized Mr. Trump’s trade actions as “illogical” and “unjustified.”
The drop in demand for Canadian goods in the midst of the tariff turmoil was greater than anticipated. Analysts surveyed by Reuters expected a deficit of 1.5 billion Canadian dollars in April.
Exports of cars and light trucks fell by 22.9 percent after the tariffs went into effect. That more than wiped out a 21 percent increase between November and March likely caused by manufacturers stockpiling vehicles in anticipation of tariffs.
Mr. Trump has said that he wants to return auto production in the United States by making producing vehicle in Canada too expensive.
Trade in auto and auto products between the two countries has been roughly balanced since they signed an auto-specific trade pact in 1965.
The tariffs have created havoc for the Canadian auto industry, which exports most of its production to the United States. Trade in autos and auto parts between the two countries has been roughly balanced for more than 50 years.
Stellantis has twice temporarily shut down an assembly plant in Windsor, Ontario, that makes Chrysler minivans and Dodge muscle cars in response to the tariffs. It also indefinitely suspended production of an electric version of the Dodge Charger Daytona muscle car and stopped a $1 billion retooling to make a new Jeep model at another factory in Brampton, Ontario.
Honda suspended an $11 billion plan to make electric vehicles and batteries in Ontario and shifted production of an S.U.V. model from its Canadian plant to the United States, though the company said that will not affect its overall Canadian output.
And General Motors cut a third shift at a pickup truck plant in Ontario.
Other factors contributed to the expanded deficit, including a rising Canadian dollar and a decline in the price of oil, Canada’s largest export by value to the United States.
Ian Austen reports on Canada for The Times based in Ottawa. He covers politics, culture and the people of Canada and has reported on the country for two decades. He can be reached at [email protected].
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