In a significant escalation of the ongoing trade war between the United States and Canada, President Donald Trump has threatened to increase tariffs on automobiles originating from Canada, moving them up from 25% to 50%, effective January 1st. This announcement comes following the collapse of US-Canada trade talks last week, with both sides accusing each other of making unreasonable last-minute demands. In response, Canadian officials have announced a news conference for Tuesday, where they will outline their strategy to counter the trade war and support affected workers and businesses. The conference will feature leaders from government, business, finance, and economic development sectors. Prime Minister Mark Carney has accused Trump of wanting to destroy Canada's auto industry and stated that Canada is ready to resume talks only if the US comes with a more cooperative attitude. The US and Canadian officials have traded blame over the breakdown in negotiations, with the US alleging last-minute changes from Canada and Canada claiming unacceptable demands by the US, including a clause limiting trade deals with other countries. Tensions have been rising as both sides dig their heels in, with Trump threatening retaliatory tariffs on Canadian auto industry and Carney announcing funding for infrastructure projects to diversify Canada's heavily US-reliant trade. Ontario Premier Doug Ford has responded fiercely to the tariff threats, telling Trump to "kiss my ass" and suggesting Canada should charge extra for oil, gas, electricity, and critical minerals. The rapid escalation of the trade war has raised concerns about the future of the USMCA trade pact between the three North American countries, with both Canada and Mexico wanting an extension but the US unwilling to renew it in its current form. Experts warn that the risk of the USMCA unraveling could plunge Canada into recession and leave it on a permanently lower growth path.