Toyota and Honda may close some of their Canadian production lines if US President Donald Trump's proposed tariffs on Canadian car imports go into effect, Reuters reports.

Trump is targeting Ottawa with a proposed 50% tariff on Canadian car imports—but Japan's Toyota and Honda could be forced to shutter some production lines in Canada if the tariffs go into effect on January 1 as proposed, analysts said

Last week, Trump announced that the US would raise tariffs on Canadian cars, auto parts, and steel imports to 50 percent—starting from January 1, 2027.

The move followed a breakdown in trade talks, after which Canadian Prime Minister Mark Carney announced that retaliatory tariffs would be imposed on the US—starting from September 8.

Toyota and Honda account for more than three-quarters of all cars made in Canada.

Canadian-built cars accounted for almost a quarter of Honda's US sales and 17% of Toyota's last year, the most among major automakers, ⁠according to Barclays analysts.