The United States and Mexico have reached an agreement to change parts of NAFTA, the trade deal that President Donald Trump has derided for years as unfair.
Trump announced the agreement from the Oval Office Monday, with Mexican President Enrique Peña Nieto dialed in on a conference call.
But the deal left open the question of whether Canada, the third country in NAFTA, would agree to the changes -- and Trump himself said he wanted to throw out the name NAFTA altogether.
"They used to call it NAFTA," Trump said. "We're going to call it the United States-Mexico trade agreement. We're going to get rid of NAFTA because it has a bad connotation."
Negotiators for both countries agreed to a new rule that dictates where auto parts are made.
Under the current law, about 62 percent of the parts in any car sold in North America must be produced in the region or automakers have to pay import taxes. The new preliminary agreement would require that 75 percent of auto parts be made in the United States and Mexico, according to the U.S. Trade Representative's office.
Much of the business world has been worried about Trump's trade policies, and the stock market reacted positively to the news. The Dow rose more than 250 points and the S&P 500 and Nasdaq hit new highs on Monday.
The agreement between the two countries could restart negotiations on NAFTA with all three parties -- the United States, Mexico and Canada.
Despite Trump's signal that the deal could lead to a bilateral trade agreement between the United States and Mexico, Peña Nieto, through a translator, expressed his "desire that now Canada will also be able to be incorporated in this."
Mexico and Canada have stood firm on the importance of maintaining the trilateral format of the NAFTA free trade deal, even as Trump has signaled a desire for individual deals with each country.
"Canada is encouraged by the continued optimism shown by our negotiating partners," said a spokesperson for Canadian Minister of Foreign Affairs Chrystia Freeland.
"Progress between Mexico and the United States is a necessary requirement for any renewed NAFTA agreement," he said.
Negotiations on rewriting the three-country NAFTA agreement began about a year ago.
The 24-year-old trade agreement generally prevents the three parties from imposing tariffs on imports from one another. But Trump has called the agreement "the worst deal maybe ever signed" and moved ahead with tariffs earlier this year.
In May, the United States imposed steep tariffs on steel and aluminum from much of the world, including Mexico. In response, Mexico slapped tariffs on $3 billion of U.S. goods, including steel, pork, apples, potatoes, bourbon and different types of cheese. Canada imposed tariffs on $12.5 billion of U.S. goods, including steel, toffee, maple syrup, coffee beans and strawberry jam.