What is going to happen is this lack of deal will accelerate the (inevitable) decline of the Canadian car industry, which will reduce objections to the Chinese imports leading to those quotas changing in an ever accelerating feedback loop.

From the US strategic perspective this is moving out of the frying pan and into the fire.

I don't understand this and would like a clarification.

There are zero Canadian automobile assemblers; they are Canadian subsidiaries of American companies, with some parts manufacturers being here.

Assuming American companies (and companies from subordinates like Japan) leave, what would be the problem in having a similar relationship with China? Is it because their manufacturing is more integrated?

The American, and other auto makers, only manufacturers in Canada because the Canadian and American auto markets have been integrated for over 80 years. Removing Canada's access to the American market basically makes Canadian auto manufacturing uncompetitive since Canada isn't a big enough market to sustain a domestic auto market.

It's so obvious that you'd think its intentional.

Canada having closer trade ties with China is also a case of "out of the frying pan and into the fire" for Canada.

I think people forget that China is an authoritarian ethno state with a single leader for life.

But hey, they have cheap shit, so what better wagon to hitch your country to?