Over 2,900 electric passenger vehicles manufactured in China were imported into Canada in May. Global Affairs Canada data revealed that May marked the commencement of electric vehicle imports from China following an agreement by Prime Minister Mark Carney to allow tens of thousands of these vehicles into the country at a reduced tariff rate, which was agreed upon during his visit to China in January.
The report indicated that 2,910 cars arrived in May, with more expected to follow, although specific brands and models were not disclosed. Prime Minister Carney mentioned during a recent speech at the Economic Club of New York that the majority of the incoming models are likely to be Teslas produced in China.
In exchange for Beijing reducing certain duties on Canadian canola, Ottawa struck a tariff-quota deal with China regarding electric vehicles. Canada previously imposed a 100% tariff on Chinese electric vehicles until 2024, but the current agreement permits up to 49,000 Chinese EVs annually to enter Canada at a 6.1% tariff, with a maximum six-month quota of 24,500 cars.
The revival of federal EV rebates and escalating gas prices due to tensions in Iran have prompted more drivers in Canada to consider transitioning to electric vehicles. Electric Mobility Canada, a group advocating for electric vehicles, noted that the increasing competition is beneficial for consumers. The organization’s President and CEO, Daniel Breton, anticipates that the influx of Chinese-made EVs will drive down prices, citing the example of the Chevy Bolt.
Meanwhile, Canada’s major automakers, including Ford, General Motors, and Stellantis, expressed concerns about the entry of these Chinese EVs, stating that it undermines the domestic auto industry and exposes Canadians to cyber risks. Brian Kingston, CEO of the Canadian Vehicle Manufacturers Association, highlighted that China’s divergence from established trade and investment norms poses challenges to the Canadian economy and auto industry.