A targeted approach to investments, on top of key battery-building advantages, could keep Canada in the fight for growth in the auto industry.

Given the inordinately high value of the tax credits in the U.S. Inflation Reduction Act (IRA), many are skeptical that Ottawa has deep enough pockets to mount an effective defence with fiscal tools alone.

Canada and Mexico have won their challenge to the U.S. interpretation of content rules for autos under the new North American trade pact; a decision that favors parts makers north and south of the U.S. border.

With cross-border auto tensions now in the rear-view mirror, Prime Minister Justin Trudeau is talking about Canada's next big bilateral challenge: head-to-head economic competition with the United States.