

President Trump announced 25% tariffs on imports from Canada and Mexico, raising concerns about the economy and the freight recovery.
Just as the trucking industry was looking forward to what most economic experts predicted would be a moderately improving freight environment for 2025, new tariffs announced by President Trump could put that in jeopardy.
The Trump administration announced that starting Tuesday, Feb. 4, it will impose a 25% tariff on imports from Canada and Mexico.
It also announced a 10% tariff on energy products from Canada and an additional 10% tariff on China.
The administration said there would be no exceptions.
And if other countries retaliate with their own tariffs, which the leaders of Canada and Mexico already have said they will, the administration said it would increase the tariffs.
What Will A New Trump Trade War Mean for Trucking?
Economic experts have said such a trade war is likely to hurt the U.S. economy and increase inflation.
“As the trucking industry recovers from a years-long freight recession marked by low freight volumes, depressed rates, and rising operational costs, we have concern that tariffs could decrease freight volumes and increase costs for motor carriers at a time when the industry is just beginning to recover,” said American Trucking Associations President & CEO Chris Spear in a statement.
While trucking supports efforts to fight drug and human trafficking, Spear said, unintended consequences that substantial tariffs could have over the long-term include higher consumer costs on the wide range of goods that cross our borders by truck, including food, automobiles, televisions, computers, furniture, and other key manufacturing inputs.
According to supply chain data from Motive’s Q1 Economic Report, we saw record trade with Mexico in the most recent quarter. Canadian truck crossings dipped almost 5% year over year and were relatively flat compared to prior years. Truck crossings from Mexico increased by 19.3%, while Canada declined 4.7%.
“The immediate impact of tariffs on trucking, freight, and supply chains will be muted,” said Hamish Woodrow, head of strategic analytics at Motive, who authored the report.
“Goods already en route, shipments six weeks out on the water, and landed inventory will continue to flow, meaning the real disruption will be felt in Q2 as businesses adjust to the new reality.”
“Ultimately, the burden of these tariffs will fall on U.S. consumers and retailers. Prices will rise, and businesses will pass along costs as they navigate increased expenses and uncertainty,” Woodow said.
“Mexico’s role as the dominant trade partner will remain strong. Our data showed trade through the Laredo port is up nearly 30% year-over-year, and October 2024 set a record 677,000 truck crossings. But any prolonged disruption could reshape regional supply chains in ways that will be felt for years to come.”
In a statement, the Private Motor Truck Council of Canada warned that “the unjustified tariffs being imposed on Canada by U.S. President Trump will have severe consequences on both the Canadian and U.S. economies” and will mean a slowdown in cross border trade, said PMTC President Mike Millian, affecting cross-border trucking.
Tariffs Could Mean More Expensive Heavy-Duty Trucks
A 25% tariff levied on Mexico could see the price of a new Class 8 tractor increase by as much as $35,000, Spear said.
“That is cost-prohibitive for many small carriers, and for larger fleets, it would add tens of millions of dollars in annual operating costs.”
Truck makers assemble a number of heavy-duty truck models in Mexico, including Freightliner in Saltillo; International in Escobedo and Santiago; Peterbilt in Mexicali.
Because many parts and components are manufactured south of the border, costs also will increase for the manufacture of trucks in the U.S.
As a Wall Street Journal article last week said about the effects of tariffs on the automotive industry, “Tariffs would upend the past three decades of the auto industry using free-trade rules and knitting together a vast factory web across the U.S., Mexico and Canada.”
While the article was about auto makers, the same holds true in many cases for truck manufacturing and other types of manufacturing as well.
The National Association of Manufacturers pointed out that thanks to the United States-Mexico-Canada Agreement signed in Trump’s first administration, one third of critical U.S. manufacturing inputs now come from Canada or Mexico, rather than from competitors like China.
“A 25% tariff on Canada and Mexico threatens to upend the very supply chains that have made U.S. manufacturing more competitive globally,” said NAM President and CEO Jay Timmons in a statement.
“The ripple effects will be severe, particularly for small and medium-sized manufacturers that lack the flexibility and capital to rapidly find alternative suppliers or absorb skyrocketing energy costs.”
More Details About the New Tariffs
Tariffs and trade wars were also a part of Trump’s first term as president.
The new tariffs are being imposed under a never-before-used emergency economic authority, “because of the major threat of illegal aliens and deadly drugs killing our Citizens, including fentanyl,” Trump posted on his Truth Social platform.
PMTC President Mike Millian took exception to that: “Despite the US administration claims, this tariff policy has zero to do with border controls,” he said in a statement.
“Less than 1% of fentanyl and illegal migrant crossings into the U.S. come from Canada. The facts simply do not support the claims. We hope common sense will prevail and these tariffs will be short lived.”
In addition, fentanyl overdose deaths already have been coming down from the highs they reached during the COVID-19 pandemic. There were just under 90,000 U.S. overdose deaths in the 12 months ended in August, down nearly 22% from the previous 12-month period, according to the Centers for Disease Control and Prevention.
According to the published reports, President Trump on Friday said more tariffs are coming on products such as computer chips, pharmaceuticals, steel, aluminum, copper, oil and gas imports, possibly as soon as this month. He wants to impose tariffs on the European Union, as well.
Updated 2:30 pm EST Feb. 3 to add comments from Motive.
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