The “U.S.” car industry is actually the North American car industry. Factories are in Canada, Mexico and the U.S. primarily and parts move across the border duty-free. This dates back to the Auto-pact.
Canada almost certainly does not want to allow Chinese made vehicles to undercut their local producers. Any talk of this is just posturing and threats in the ongoing trade negotiations.
Trump says he wants every car sold in the United States to be made domestically.
The old integrated cross-border auto manufacturing system is over. Stellantis is already moving production of Jeep from Brampton to Illinois, and others are expected to follow.
Canada almost certainly does not want to allow Chinese made vehicles to undercut their local producers. Any talk of this is just posturing and threats in the ongoing trade negotiations.