A Potential Trump Return Threatens the USMCA Trade Deal

The specter of a second Donald Trump presidency is casting a long shadow over North American trade, with the landmark United States-Mexico-Canada Agreement (USMCA) squarely in its crosshairs. As the agreement approaches its first formal review in 2026, officials and trade experts from all three member countries are sounding the alarm. Behind closed doors and in high-level hearings, a singular, urgent question is being asked: Is the USMCA strong enough to survive another Trump term?

The 2026 Review: A Built-In Flashpoint

Unlike its predecessor, NAFTA, the USMCA was designed with a built-in sunset clause. The deal is set for a joint review in 2026, after which it can be terminated with just six months’ notice if any of the three countries decides to walk away. This mechanism, once seen as a way to ensure the agreement remained relevant, now looks like a potential trigger for dissolution.

Former U.S. Trade Representative Robert Lighthizer, a key architect of the USMCA under Trump, has already signaled that a returning Trump administration would push for major, aggressive changes. The 2026 review is not merely a check-up; it is poised to become a high-stakes renegotiation where the very existence of the trade bloc could be on the line.

Key Pressure Points and Potential Demands

A Trump 2.0 trade agenda would likely focus on several contentious areas where he believes the USMCA did not go far enough. These demands would create immediate friction with both Canada and Mexico.

Stricter Rules of Origin for the Auto Industry

The USMCA already significantly tightened rules, requiring 75% of a vehicle’s components to be made in North America to qualify for duty-free treatment. Insiders suggest a returning Trump administration would push this threshold even higher, potentially to 90% or more. Furthermore, there would be intense pressure to further increase the requirement for high-wage labor (over $16 USD per hour) in auto manufacturing, a rule specifically designed to shift jobs from Mexico back to the U.S. and Canada.

The “America First” Energy Agenda

Energy sovereignty is expected to be a major battleground. The current USMCA protects Mexico’s state-owned energy sector to a significant degree. A Trump administration, aligned with U.S. oil and gas interests, would likely challenge Mexico’s policies more aggressively, arguing they unfairly disadvantage American companies. This could lead to a flood of new dispute settlement cases and demands to rewrite the energy chapter.

Sunset Clause as an Ultimatum Tool

The most powerful weapon in a potential renegotiation is the sunset clause itself. The threat of unilateral withdrawal would be used as leverage to force concessions. As one Canadian trade official privately noted, the dynamic would shift from collaborative problem-solving to a scenario where the U.S. presents a list of demands with an implicit “or else” attached.

Canada and Mexico: Preparing for the Storm

Both northern and southern U.S. neighbors are not sitting idle. They are actively gaming out scenarios and strengthening their own alliances.

Perhaps the most significant move is the quiet deepening of the bilateral relationship between Canada and Mexico. The two countries are working more closely than ever to align their positions, share intelligence, and present a united front where possible. They recognize that a divide-and-conquer strategy would be a primary tactic from a Trump White House.

The High Stakes for North American Competitiveness

The uncertainty alone is damaging. Businesses thrive on predictability, and the prospect of the continent’s trade rules being torn up in 2026 is causing executives to hesitate on long-term investments. This comes at a critical time when North America is trying to onshore supply chains and compete against economic blocs like the European Union and China.

“The biggest risk isn’t just changes to the agreement—it’s the paralysis that the threat creates,” explains a trade lawyer who has worked on USMCA panels. “Why would an auto company build a billion-dollar plant in Ohio or Ontario if the duty-free access to the entire North American market might vanish in a few years?”

The stability that the USMCA was supposed to provide is now under threat from the political forces that created it.

Conclusion: An Uncertain Future for a Trillion-Dollar Relationship

The USMCA governs a trade relationship worth nearly $2 trillion USD annually. Its potential unraveling is not a minor policy dispute; it is an existential threat to the economic foundation of North America. While Canada and Mexico are preparing for a defensive battle, the overwhelming leverage lies with the United States.

The 2024 U.S. election, therefore, is not just a choice between domestic policies. It is a referendum on the future of North American economic integration. A Trump victory would almost certainly mean a brutal renegotiation where the core tenets of free trade are challenged. The survival of the USMCA in its current form would be unlikely, and the continent would face a return to the turbulent, adversarial trade environment that the agreement was meant to end.

The coming years will test whether the institutional and economic bonds forged under the USMCA are strong enough to withstand the political winds of change. For now, officials in Ottawa, Mexico City, and Washington can only watch, wait, and prepare for a storm that may be on the horizon.