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President Donald Trump’s escalating trade fight with Canada could deliver an economic blow to one of the country’s most closely watched battleground states, potentially raising costs for automakers and prices for consumers.
Michigan, home to a fiercely contested U.S. Senate race this November, is particularly vulnerable because its auto industry depends heavily on a cross-border supply chain with Canada.
America’s northern neighbor received roughly $21.2 billion worth of Michigan exports in 2025, about 36% of the state’s total, mainly vehicles and parts, according to the Michigan Department of Transportation. David Clement, policy director of the free market nonprofit Consumer Choice Center, warned the costs of tariffs could ultimately reach Michigan drivers.
“How you see this as a Michigan consumer is higher prices on the dealership lot,” Clement told Fox News Digital, describing tariffs alongside already-elevated living costs as a “double whammy.”
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The trade fight has escalated under Trump and Canadian Prime Minister Mark Carney, with negotiations breaking down and both countries imposing new measures targeting each other’s goods. (Anna Moneymaker/Getty Images)
Those concerns come as Trump has intensified his trade dispute with Canada.
He imposed an additional 50% tariff on certain Canadian products earlier this year, and the administration has since barred certain Canadian products from entering the U.S. beginning Sept. 29.
Clement said Michigan ranks among the states most exposed to the dispute.
“Michigan, in terms of ranking all of the states in their export vulnerability in the trade war, sits at around seventh,” he said, pointing to equipment, machinery and the auto industry as areas of concern.
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Michigan is the heart of the U.S. auto industry, with thousands of workers employed in vehicle and parts manufacturing across the state. (Krisztian Bocsi/Bloomberg/Getty Images)
That vulnerability is compounded by how frequently auto parts cross the border before a vehicle is completed.
“Most Americans don’t know that a single component on a U.S.-assembled vehicle can cross the border upwards of eight times before it’s actually completed,” Clement said.
“When you are tariffing automotive parts going across the border each way, that is where the exposure numbers start to tick up,” he added, warning that tariffs and retaliation can “really gum up the very intertwined supply chain for cars between Michigan and Ontario.”
The economic stakes come as Democrat Abdul El-Sayed and Republican Mike Rogers compete for the Senate seat being vacated by retiring Democratic Sen. Gary Peters.
Even as the trade fight creates potential political risks in Michigan, the Trump administration has defended its actions as necessary to protect American businesses and workers and level the playing field with Canada.
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Democratic Senate nominee Abdul El-Sayed, a progressive former public health official backed by Sen. Bernie Sanders, is facing Republican Mike Rogers for Michigan’s open U.S. Senate seat in a closely watched midterm contest. (Sarah Rice/Bloomberg via Getty Images)
Clement, however, argued the dispute could put pressure on American businesses at a politically sensitive time.
“It would appear that Donald Trump’s original escalation against Canada has somewhat backfired in terms of the midterms,” Clement said.
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He warned that businesses dependent on Canadian goods could feel the effects just as voters head to the polls.
“American manufacturers or American businesses who rely on Canadian inputs are going to start to feel the pain right in the lead-up to going to the ballot box,” Clement said. “Cost of living, cost of goods, cost of doing business is such an important factor for Americans who are going to be casting a ballot.”