Canada has decided to implement a 100% tariff on Chinese-made electric vehicles, aligning with tariffs imposed by the United States. Additionally, Prime Minister Justin Trudeau announced a 25% tariff on Chinese steel and aluminum during a cabinet retreat in Halifax, Nova Scotia. Trudeau cited China’s unfair advantage in the global marketplace as the reason for these actions.
The Canadian government initiated a 30-day consultation earlier this summer to address concerns raised by Deputy Prime Minister Chrystia Freeland about Chinese companies creating a global oversupply. This decision follows similar moves by the United States and the European Commission to impose higher tariffs on Chinese EVs.
During a meeting with Trudeau and cabinet ministers, U.S. national security advisor Jake Sullivan encouraged Canada to take this step to counter the issue. Currently, Tesla is the only Chinese-made EV imported into Canada, produced at the company’s Shanghai factory, with no Chinese-branded EVs being sold or imported in the country.
Freeland emphasized that Canada will coordinate with the U.S. and the EU to prevent becoming a destination for Chinese oversupply, citing the integrated auto sector in North America. U.S. President Joe Biden has criticized Chinese government subsidies for EVs and other goods, claiming they provide Chinese companies with an unfair advantage in global trade by not requiring them to be profitable.
Chinese companies have been able to sell EVs at prices as low as $12,000, with significant capacity in solar cell plants, as well as steel and aluminum mills, to meet global demand. Chinese officials argue that their production helps keep prices low and supports the shift to a greener economy.