Cross-border trucking freight continued to grow in May, but will complications with United States-Mexico-Canada (USMCA) agreement negotiations and new tariffs on Canada change that trajectory?
Since last October, cross-border trucking has seen year-over-year growth in every month except January. While there were double-digit percentage increases in April and May, significant losses from sweeping tariffs the year before likely contributed to that number.
Most of the cross-border trucking growth has come from the southern border. From February 2025 to this May, freight coming in and out of Canada dropped in all but four months. Much of the growth in Mexican freight has come from computer-related exports, which have sustained massive growth since 2024.
Although Canadian cross-border trucking freight has gone up for two consecutive months, it may revert to losses. On July 20, President Donald Trump announced a new set of tariffs on certain Canadian products.
Effective Aug. 19, there will be an additional 50% tariff on Canadian dairy products, alcohol, motor vehicles and a variety of other goods. However, the fate of tariffs may be up in the air.
In this round of tariffs, Trump is using Section 338, which allows tariffs on products from countries that discriminate against U.S. commerce. Considering Section 338 has never been invoked before, legal challenges are likely.
Additionally, Canadian Prime Minister Mark Carney claims that tariffs on automobiles violate the USMCA.
My statement on the United States administration’s intention to impose new tariffs on Canadian goods: pic.twitter.com/wl8JtbQjyC
— Mark Carney (@MarkJCarney) July 20, 2026
Carney and Trump could reach a deal before the tariffs go into effect. Last year, Trump imposed tariffs on nearly every country, but negotiations between countries led to a series of delays lasting months.
Will the new tariffs affect cross-border trucking?
It may be too early to tell. Those who have been involved in cross-border freight have seen this before and know the drill. Craig Watson, vice president and managing director for Canada at Uber Freight, indicated that motor carriers are mostly in a holding pattern right now.
“The industry is on alert, but nobody is pressing the panic button just yet,” Watson said. “Right now, most shippers and carriers are taking a measured, ‘wait-and-see’ approach. While there are legitimate concerns, like cost spikes and border delays, veteran operators recognize this 30-day window as leverage in broader (USMCA) negotiations. As a result, we aren’t seeing fleets make drastic route shifts or pull capacity today.”
In addition to the 50% Canadian tariffs, U.S. Trade Representative Jamieson Greer announced a 10% or 12.5% tariff on 60 countries, which covers 99.4% of U.S. imports. That includes Canada, China and Mexico. Those tariffs went into effect on July 24, the same day Section 122 tariffs expired, essentially replacing them.
Section 122 allows the president to temporarily impose tariffs to address severe trade deficits are good for only 150 days. They were installed in response to the Supreme Court’s decision striking down global reciprocal tariffs under the International Emergency Economic Powers Act (IEEPA).
Using Section 301, the justification this time is based on importing goods produced with forced labor. The Liberty Justice Center, which successfully challenged the administration’s IEEPA tariffs, has filed a lawsuit contesting the new Section 301 tariffs.
What about USMCA?
Thinking more long-term, the future of cross-border trucking could be shaped by current USMCA negotiations.
Although the 16-year trade deal is not set to expire until 2036, the three countries have a chance to renew USMCA. This year was the first bite at that apple, and no trilateral deal has been reached.
On July 23, the U.S. and Mexico met for their third round of bilateral negotiations. A fourth meeting is scheduled for September.
While formal bilateral negotiation rounds with Mexico are progressing, there appears to be greater tension with Canada. No formal negotiation rounds have been conducted with Canada. On July 15, Canadian Trade Minister Dominic LeBlanc said Canada remains actively engaged with the U.S. and Mexico on a bilateral and trilateral basis.
Because the three countries did not agree to extend the USMCA’s term, they will conduct annual reviews until they approve an extension or the agreement expires in 2036. LL
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