Lutnick dismisses any prospect of auto deal between U.S. and Canada: sources

Minister responsible for Canada-U.S. Trade Dominic LeBlanc discusses the Oval Office meeting between PM Carney and U.S. President Trump.

U.S. Commerce Secretary Howard Lutnick is dismissing any prospect of a comprehensive auto deal with Canada, according to three sources in the room when he made the comments.

Lutnick made the comments during a discussion under Chatham House Rules at the US-Canada Summit, hosted by BMO and Eurasia Group in Toronto on Wednesday, one day after the second in-person meeting in Washington between U.S. President Donald Trump and Prime Minister Mark Carney.

According to the sources, Lutnick said the U.S. could continue buying parts from Canada, “but that’s about it.”

The U.S. has had 25 per cent tariffs on all foreign-made autos since April. In the case of Canadian auto exports, for those that comply with the Canada-U.S.-Mexico Agreement (CUSMA), the levies apply to the non-American components.

Those levies are stacked on a slate of other tariffs on Canadian goods, including all goods that are not CUSMA-compliant, as well as sectoral tariffs on steel, aluminum, and copper.

Canada also has countermeasures in place, including 25 per cent on autos that are not covered by CUSMA.

According to sources, Lutnick also said Canada should “come second” to the U.S. on autos.

Speaking to reporters in the Oval Office on Tuesday, Trump said that the Americans “want Canada to do great,” but there’s also a point at which the two countries want the same business.

“It’s a tough situation, because we want to make our cars here,” Trump said. “At the same time, we want Canada to do well making cars. So, we’re working on formulas, and I think we’ll get there.”

While Canada-U.S. Trade Minister Dominic LeBlanc did not offer up any tangible outcomes from Tuesday’s meeting, he categorized it as “successful,” “positive,” and “effective.”

Ontario Premier Doug Ford, meanwhile, has been vocal in his opposition to Trump’s tariffs. In response to Lutnick’s comments, he told reporters on Wednesday that the auto sector needs to “be prepared.”

“As I’ve always said, the Auto Pact has been around since the 1960s, you can’t unscramble an egg, you have to make the omelette larger,” Ford said.

“I would say it’s a massive threat,” he also said. “(Lutnick would) only say it if the president gave him the green light.”

Canada, U.S. should renegotiate CUSMA bilaterally: Lutnick

Also according to sources in the room, Lutnick said in his personal opinion Canada and the U.S. should cut Mexico out of their trade deal renegotiations to ink a new agreement bilaterally.

Both Canada and the U.S. have launched consultations on CUSMA, with the trade agreement already set for review next year.

Also addressing the Eurasia Summit later Wednesday, Carney said part of the negotiations is finding areas where there is “alignment of interest,” which could include bilateral agreements.

“There’s going to be, (in) my view, some bilateral deals — there already are — alongside (CUSMA), that it’s not an either-or necessarily,” he said. “And that’s one of the realities of the negotiations.”

Speaking to reporters last month in Mexico City, the prime minister seemed to dismiss the idea of working against Mexico in the renegotiations.

“We are going to cooperate directly. As we always have, CUSMA is strength together. It’s strength of the three countries together,” Carney said.

Keystone XL brought up during White House meeting

According to someone with knowledge of the discussions, the abandoned expansion of the Keystone Pipeline was raised in Tuesday’s meeting between Carney and Trump.

The project was raised in the context of linking energy between the two countries and more energy cooperation, and the conversation was only in the context of getting relief on steel and aluminum tariffs, according to the source.

The news was first reported by CBC News.

Asked on Parliament Hill upon his return from Washington on Wednesday whether he and Trump have agreed to revive Keystone XL, Carney said the two had “a very good discussion on a wide range of issues.”

In a press release on Wednesday, the Prime Minister’s Office wrote that the two leaders discussed “key priorities in trade and defence.”

“The leaders identified opportunities for material progress in trade in steel, aluminum, and energy, and directed their teams to conclude this work in the coming weeks,” the statement reads.

A spokesperson for South Bow, which owns the Keystone pipeline, said the company is “not privy” to discussions between the two governments.

“South Bow is supportive of efforts to find solutions that increase the transportation of Canadian crude oil,” spokesperson Solomiya Lyaskovska wrote in an email to CTV News. “We will continue to explore opportunities that leverage our existing corridor with our customers and others in the industry.”

Expanding the Keystone pipeline was first proposed under former U.S. president George W. Bush, but was quashed by his successor, Barack Obama.. Trump revived the project during his first term, but it was later cancelled by former president Joe Biden.

With files from CTV News’ Vassy Kapelos, Rachel Aiello, Brennan MacDonald and Siobhan Morris