Government/Policy
May 12, 2026
Lutnick: USMCA could be replaced by separate deals with Mexico and Canada
Written by Michael Cowden
US Commerce Secretary Howard Lutnick said the US should pursue separate, bilateral trade negotiations with Canada and Mexico instead of renewing the US-Mexico-Canada Agreement (USMCA).
“USMCA shouldn’t be USMCA. It should be the US and Mexico, and the US and Canada,” Lutnick said.
Lutnick made the comments during a fireside chat at the American Iron and Steel Institute (AISI) 2026 Annual General Meeting on Monday evening.
Recall that USMCA, which replaced the North American Free Trade Agreement (NAFTA), went into effect on July 1, 2020. It is scheduled for a joint review on its sixth anniversary, July 1, 2026.
“Basically, they (Canada and Mexico) agreed it could be canceled. But in six years, so Trump wouldn’t be there,” Lutnick joked.
Trump’s first four-year term expired in 2020. Few expected him to serve a second four-year term starting in 2024.
“Now, he gets to say, ‘I’m back!’” Lutnick said, an apparent reference to Friday the 13th, a popular horror movie in the 1980s.
Lutnick contended that USMCA, in its current iteration, allows Canada and Mexico “to be treated like Georgia and Alabama.”
“You can drive across the border, and so he (Trump) just doesn’t like that idea, and so that’s why he’s renegotiating USMCA,” Lutnick said.
The focus now for the Trump administration: “What are the parts that we should keep? And what are the parts we should change?”
He also expressed frustration at Canadian officials for, among other things, referring to the trade pact as the Canada-US-Mexico Agreement, or CUMSA.
Lutnick described the US as Canada’s largest client, given Canada’s dependence on the US economy. “When you call the client, isn’t the client always right?” he quipped. “You would think, when they pick up the phone with me, they would say ‘USMCA’. But they are so keen to call it ‘CUSMA.’”
Lutnick was also asked whether Trump – who is on a trade mission to China – would allow the US to import EVs from China. Or whether the US would allow Chinese automakers to build assembly plants in the US.
The question came against the backdrop of Canada in January agreeing to allow 49,000 EVs from China into its market at a tariff rate of 6.1%, down from a prior rate of 100%.
Lutnick’s answer: “No.” He also suggested Chinese EVs could pose a national security threat. “I don’t know what kind of software they have in them. I don’t know what kind of controls they have in them. … They gotta stay in Canada.”
