The US and Canada are supposed to sit down and renegotiate the biggest trade deal in North America. One side just called the other nuts. In public.
That is not how you normally start a negotiation. It also tells investors a lot about how these talks are kicking off.
At a DC economy summit Friday, Lutnick hit back at Canadian Prime Minister Mark Carney. Carney had floated closer ties to China and said he was open to Chinese EVs.
"That is like the worst strategy I've ever heard. They suck," Lutnick said. Then he added: "Is this nuts?"
His team tried to clean it up. A Commerce spokesperson said Lutnick was misquoted and meant Canada "sucks off of" the $30 trillion US economy. Translation - the trade gap the White House has been hammering on.
Lutnick kept coming back to cars. He called out automakers moving plants from Ohio and Michigan to Mexico. He framed it as a move to dodge US unions.
The formal USMCA joint review begins July 1 - the six-year anniversary of the agreement. USTR Jamieson Greer has already warned the renegotiation may spill past that date. The deal is the same one President Trump signed in his first term and has since called "a bad deal."
What set Lutnick off? A comment from Canada's former chief trade negotiator, Steve Verheul. He said time is on Canada's side.
USMCA covers cars, dairy, lumber, energy, and a long list of cross-border supply chains your portfolio touches. Think of it as the plumbing behind a huge chunk of North American manufacturing. You do not notice it until someone starts banging on the pipes.
Right now, someone is banging on the pipes. Loudly. On camera. Well before the formal review even kicks off.
The deal is not dead. But the people running the talks are trading insults instead of terms.
