Trump’s escalating trade war with Canada could increase costs for businesses and consumers in key battleground states before voters go to the polls.
President Donald Trump’s escalating trade war with Canada is raising new concerns in battleground states as November’s midterm elections approach.
The United States and Canada have imposed tariffs on goods worth billions of dollars, while Washington has also banned nearly $1 billion in Canadian imports, including alcohol, dairy products and motorcycles.
The latest measures came into force on September 29 while negotiations are still not resolved.
Trump says the tariffs will bring manufacturing back to the United States and protect American industries. But companies could cut production, consumers could face higher prices and manufacturers could delay investments.
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The trade fight intensified under Trump and Canadian Prime Minister Mark Carney, with negotiations breaking down and both countries imposing new measures targeting each other’s products. (Getty Images)
“The cost of living, the cost of goods, the cost of doing business is a very important factor for Americans going to vote,” David Clement, policy director at the Consumer Choice Center, told Fox News Digital.
Clement identified Ohio, Illinois, Michigan, Pennsylvania and Wisconsin as being among the states most exposed to Canadian retaliation because of their manufacturing, agricultural and cross-border supply chains.
“American manufacturers or American companies that rely on Canadian inputs are going to start feeling the pain right before they go to the polls,” he said.
The trade fight has intensified since Canada’s retaliatory tariffs took effect in September. At a recent meeting of G20 trade ministers, US Trade Representative Jamieson Greer acknowledged that key questions remained unanswered.
Ohio
Ohio is one of the states most vulnerable to Canadian retaliation, with about $2.3 billion in exports exposed, according to Clement.
The state’s machinery, transportation, minerals and metals industries rely heavily on Canadian buyers and cross-border supply chains. Tariffs could make Ohio products more expensive and reduce demand for products made by in-state manufacturers.
Michigan
Michigan’s auto industry faces increased uncertainty as tariffs threaten the deeply integrated supply chain linking the state to Canada. (Krisztian Bocsi/Bloomberg/Getty Images)
Michigan may face the most obvious risk because of its deeply integrated auto industry and close ties to neighboring Ontario.
Auto parts can cross the Canada-U.S. border multiple times before a vehicle is completed, meaning tariffs can increase costs at each stage of production.
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“Most Americans don’t know that a single component of a vehicle assembled in the United States can cross the border more than eight times before it is actually completed,” Clement said.
The stakes could rise further if the administration moves forward with a possible 50% tariff on Canadian auto exports starting Jan. 1 if the countries cannot agree.
Pennsylvania
Pennsylvania could have just under $1.8 billion in exposed exports, including machinery and equipment, according to Clement.
The state’s manufacturers rely on Canada as a major customer, while many also rely on Canadian inputs. This creates a double burden if tariffs make materials more expensive and finished products harder to sell.
Illinois
President Donald Trump has defended the tariffs as a way to protect American industries and bring manufacturing back to the United States. (Getty Images)
Illinois has exposure to the manufacturing, agriculture, and transportation sectors.
Its companies sell machinery, food products and chemicals in Canada, while Midwest companies rely on Canadian materials and components. Customs duties could make these exports less competitive and, ultimately, impose higher production costs on consumers.
Wisconsin
Wisconsin’s economy is closely linked to that of Canada through agriculture, manufacturing and food production.
The state exports dairy products, machinery and agricultural equipment. Canadian tariffs could make these products more expensive and encourage Canadian buyers to look for alternatives.
Wisconsin farmers and manufacturers are particularly vulnerable, as many operate on tight margins and depend on predictable access to Canadian customers.
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Even if Democrats make progress in November, Clement said a shift in congressional control would not necessarily end the tariffs because presidents have broad authority over trade policy.
But as the conflict continues, its impact on prices, jobs and businesses could become a deciding issue in states that determine Congressional control.
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