The U.S. International Trade Commission has opened a new investigation into automobile rules of origin under the Canada-United States-Mexico Agreement (CUSMA), aiming to assess their impact on the U.S. economy, competitiveness, and relevance amid rapid technological change.
According to a notice published on the commission’s website, the probe marks the third scheduled review since the trilateral pact, commonly known as CUSMA, replaced the North American Free Trade Agreement during the first administration of President Donald Trump.
The commission is required to conduct these assessments every two years through 2031, with the latest report on the automotive sector due to the White House and the U.S. Senate by July next year.
The review comes at a sensitive moment for North America’s deeply integrated auto industry, which has faced disruption following the introduction of 25% tariffs on automobiles alongside separate duties on steel and aluminum.
Automotive trade rules were a central issue during negotiations that led to CUSMA, which raised regional value content thresholds and introduced stricter labor and sourcing requirements.
Under the agreement, vehicles must contain at least 75% North American content to qualify for tariff-free treatment. In addition, 40% of a passenger vehicle must be produced in either Canada or the United States, rising to 45% for trucks.
The deal also expanded content requirements for auto parts and raw materials while strengthening wage provisions for workers in the supply chain.
Flavio Volpe, president of the Automotive Parts Manufacturers’ Association, said American content in Canadian-built vehicles has increased significantly, rising from 38% under NAFTA in 2019 to about 50% under CUSMA by 2024.
He described the agreement as a major gain for U.S. parts suppliers and raw material producers, adding that Canadian content levels have remained broadly stable.
A previous commission report released in 2025 found that CUSMA contributed to increased investment in U.S. automotive manufacturing and boosted revenues and employment among parts makers.
The study also noted higher production costs tied to compliance with the stricter rules of origin, raising concerns about the competitiveness of vehicles produced within the trade bloc against imports from outside the agreement.
The new investigation arrives as debate intensifies over the future of the pact. Members of the Trump administration have criticized CUSMA, arguing it has harmed the U.S. auto industry, while the president has repeatedly signalled opposition to vehicles produced in Canada or Mexico and raised the possibility of withdrawing from the agreement.
CUSMA is scheduled for formal review this year, with analysts warning that expanding tariff measures could complicate its long term stability.
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