WASHINGTON (AP) — President Donald Trump is announcing a trade "understanding" with Mexico that could lead to an overhaul of the North American Free Trade Agreement.

Trump made the announcement Monday in the Oval Office, with Mexican President Enrique Pena Nieto joining by speakerphone.

Canada, which is part of NAFTA, is not participating in the announcement. Trump says negotiations with Canada have yet to begin and is calling on the country to negotiate fairly. He's threatening anew to slap tariffs on Canadian cars if they fail to do what he wants.

Trump says the call is being held to "celebrate the understanding" the U.S. and Mexico have reached on trade.

He says, "It's an incredible deal for both parties."