CANADA struck back at the Trump administration Friday over U.S. steel and aluminum tariffs, vowing to impose punitive measures on C$16.6 billion (US$12.63 billion) worth of American goods until Washington relents.

The retaliation came as General Motors Co. (GM) warned that any tariffs Washington might impose on imported vehicles could cost U.S. jobs.

Rising trade tensions between Canada and the United States and a pushback from U.S. businesses on further tariffs, including on imported autos, pressured a White House that has championed an “America First” protectionist stance since Trump took office in January 2017.

Canada’s retaliatory tariffs, effective Sunday, largely target U.S. steel and aluminum products, along with foodstuffs such as coffee, ketchup and whisky, according to a list released by Canada’s Finance Department.

“We will not escalate and we will not back down,” Canadian Foreign Minister Chrystia Freeland told reporters at a Stelco Holdings Inc. plant in the steel city of Hamilton, Ontario.

The measures are designed to pressure Trump by focusing on goods from the United States where Trump’s Republican Party is fighting to hold Congressional seats in the November mid-term elections. They were announced just as America’s largest automaker warned that overly broad tariffs could isolate U.S. businesses and cut jobs.

The Trump administration in May launched an investigation into whether imported vehicles posed a national security threat. Trump has repeatedly threatened a 20-percent import tariff on vehicles.

In comments filed with the U.S. Commerce Department, GM said expansive tariffs could “lead to a smaller GM, a reduced presence at home and abroad for this iconic American company, and risk less — not more — U.S. jobs.”

GM, which makes many vehicles for the U.S. market in Mexico and Canada, said the tariffs could hike vehicle prices and reduce sales.

Even if automakers opted not to pass along higher costs to consumers, “this could still lead to less investment, fewer jobs, and lower wages for our employees. The carry-on effect of less investment and a smaller workforce could delay breakthrough technologies,” GM said.

Canada’s Freeland called the idea of auto tariffs “absolutely absurd.” U.S. officials have linked the tariffs to slow progress in talks to modernize the North American Free Trade Agreement, which Trump said is a disaster and must be changed.

Trump said Friday his administration’s investigation into whether to increase tariffs on cars from the European Union and other trading partners would be completed in three to four weeks.

Trump ordered the “Section 232” national security probe into autos May 23, and his unusually fast timeline calls for it to be possibly completed in just over two months.

(SD-Agencies)