Trudeau calls Trump to talk about auto tariff threat

May 27, 2018 11:32 PM

Canada- Prime Minister Justin Trudeau's office said he talked to U.S. President Donald Trump today about his administration's decision to investigate auto imports as a threat to national security, a day after Trudeau said the idea was based on flimsy logic.

Leaders also discussed the prospect of bringing NAFTA negotiations to a 'timely conclusion

Trudeau spoke with Trump by phone, according to a readout from the Prime Minister's Office. The PMO said the two leaders also discussed bringing North American Free Trade Agreement negotiations to a "timely conclusion."

"The prime minister also raised strong concerns about the U.S.'s section 232 investigation on automobile imports, given the mutually beneficial integration of the Canadian and American auto industries," the readout said.

A White House statement on the call turned out to be much briefer, mentioning only that the two leaders spoke about ongoing NAFTA talks.

"President Donald J. Trump spoke today with Prime Minister Justin Trudeau of Canada about the North American Free Trade Agreement and other trade and economic issues," the statement said.

On Wednesday evening, the White House issued a statement saying U.S. Commerce Secretary Wilbur Ross was initiating an investigation under Section 232 of the Trade Expansion Act of 1962 to determine "whether imports of automobiles and automotive parts threaten to impair" U.S. national security.

"There is evidence suggesting that, for decades, imports from abroad have eroded our domestic auto industry," said Ross in a statement.

The investigation will look at the impact of imports of automobiles, SUVs light trucks and auto parts.

Section 232 was the section Trump used to slap tariffs on steel and aluminum imports back in March. This week's notice did not single out any country or automotive brand asTrudeau reacts to Trump's investigation of the auto industry.

In this Reuters interview clip Prime Minister Justin Trudeau reacts to U.S. President Donald Trump's decision to investigate whether foreign cars have hurt the U.S. auto industry and/or undermined American national security. 1:04

Responding to the move Thursday, Trudeau said he could not understand the basis for the investigation.

"I am — even more than I was with steel and aluminum — trying to figure out where a possible national security connection is," Trudeau told Reuters. "Taking that a step further into autos seems to me to be on even flimsier logical grounds.

"But we know that this is very much linked to ongoing negotiations around moving forward on NAFTA."

U.S. tariffs could cause chaos for a Canadian auto industry that is heavily integrated between Canada, Mexico and the United States. Canada is home to major plants operated by General Motors, Ford, Fiat Chrysler, Honda and Toyota.

Congress originally set a deadline of May 17 for reaching a new NAFTA agreement, saying it needed the time to conduct a proper analysis of the deal before the midterm elections.

House Speaker Paul Ryan later walked back that statement, suggesting a more flexible deadline might be possible.

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