Canada imported C$1.08 billion (US$784 million) worth of passenger vehicles from Mexico in June, surpassing the C$950 million brought in from the United States, according to Statistics Canada. It is the first month since the early 1990s that Mexican-built cars outsold U.S. models in the Canadian market, marking a significant realignment in North American auto trade flows. Industry executives and analysts attribute the shift primarily to the 25% tariff President Donald Trump imposed on foreign automobiles earlier this year. Although vehicles shipped under the U.S.–Mexico–Canada Agreement face duties only on non-U.S. content, the levy has disrupted long-established supply chains. Canada responded with a matching tariff on U.S.-assembled vehicles but offers relief for manufacturers that keep production and investment in the country. Automakers including General Motors and Ford, which traditionally serve Canada with U.S.-built vehicles, have accelerated efforts to reconfigure production and logistics to mitigate rising costs. "What we’re seeing now is a begrudging acceptance that perhaps this is a new world and we are going to be living with tariffs over the long term," said Brian Kingston, chief executive of the Canadian Vehicle Manufacturers’ Association. Erin Keating of Cox Automotive added that clarity on trade rules is vital because the United States’ attraction for auto investment depends on integrated North American supply chains.