The Trump administration has declined to renew the U.S.-Mexico-Canada Agreement (USMCA) in its current form, triggering a 10-year countdown before the North American trade pact expires unless all three countries agree on a revised version.
The decision followed a scheduled six-year review of the agreement. While the USMCA will remain in force for another decade with annual reviews, the United States said it wants significant changes aimed at bringing more manufacturing jobs back home and reducing trade deficits with Mexico and Canada.
U.S. Trade Representative Jamieson Greer said Washington had decided not to extend the agreement in its existing form, citing unresolved shortcomings and persistent trade imbalances with its North American partners.
“The United States did not agree to renew the USMCA in its current form,” Greer said, adding that negotiations with both Mexico and Canada would continue to address the agreement’s weaknesses and trade deficits.
The United States is scheduled to begin another round of bilateral trade talks with Mexico during the week of July 20. According to a senior administration official, discussions will focus on tightening North American rules of origin for automobiles and other industrial products, while strengthening economic security measures designed to prevent countries such as China from benefiting from preferential USMCA access.
Mexican Economy Minister Marcelo Ebrard said Mexico remained committed to resolving Washington’s concerns over manufacturing jobs and trade deficits, although both countries continue to disagree over stricter automotive content requirements.
Ebrard said Mexico would not allow its automotive industry to be placed at a disadvantage and described vehicle production rules as the main sticking point in negotiations with the United States.
Canadian Trade Minister Dominic LeBlanc said Canada would continue discussions with Washington while also seeking solutions to tariffs imposed on Canadian steel, aluminium, automobiles and lumber.
The USMCA, negotiated during President Donald Trump’s first administration, replaced the North American Free Trade Agreement (NAFTA) in 2020 and supports a regional economy worth approximately US$1.6 trillion in annual trade.
The Trump administration said more time is needed to resolve issues surrounding the agreement, including the United States’ growing goods trade deficits, which reached US$197 billion with Mexico and US$48.3 billion with Canada in 2025.
The administration has also proposed stricter automotive rules requiring vehicles built in North America to contain 50% U.S.-made content, while increasing the overall regional content requirement to 82%.
Industry groups, including major automakers, have urged all three countries to preserve the USMCA framework, warning that additional restrictions could make vehicle production more expensive and reduce North America’s competitiveness against manufacturers in Asia and Europe.
Nissan CEO Ivan Espinosa warned that tougher U.S. content requirements could worsen vehicle affordability for American consumers, noting that existing supply chains are not structured to source all components domestically.
Agricultural organisations have also expressed support for maintaining the trade pact, pointing out that Mexico and Canada together account for more than one-third of U.S. agricultural exports and remain vital markets for American farmers and food producers.
