Canada announced on Monday that it would be imposing 100% import tariffs on electric vehicles (EVs) made in China, as well as a 25% tariff on steel and aluminum imports from China. This decision follows similar moves by the U.S. and the European Union, citing concerns over unfair subsidies and competition. The new tariffs are set to take effect on October 1 for EVs and October 15 for steel and aluminum.
The Canadian government stated that industries such as EVs, steel, and aluminum face unfair competition and trade practices from China, echoing similar allegations made by the U.S. and EU. The goal of the new measures is to level the playing field for Canadian workers and allow domestic industries to compete both domestically and globally. The government plans to review the effectiveness of these tariffs after one year and may consider extending or implementing additional measures if necessary.
The Biden Administration announced a 100% tariff on Chinese EVs in May, while the EU imposed higher tariffs on China-made EVs in July. However, the EU recently lowered some of the planned tariffs on Chinese EVs, including those made by Tesla, last week. Despite the tariffs, experts believe that China’s EV growth momentum may be affected but will not be completely eliminated.
In response to Canada’s decision, the Chinese Embassy expressed strong dissatisfaction and opposition, stating that the tariffs violate WTO rules and will harm trade and economic cooperation between the two countries. The Embassy spokesperson emphasized that China’s EV industry’s rapid development is due to technological innovation, established supply chains, and market competition rather than government subsidies. Chinese EV maker BYD has established a presence in Canada, but Chinese brands are not prominent players in the market.
Data shows that automobile imports from China to Canada’s largest port in Vancouver surged by 460% in 2023, attributed to Tesla’s shipments of EVs manufactured in its Shanghai factory. It is reported that Chinese EVs have not gained significant market share in Canada. As part of the new measures, Canada will conduct a review of other critical industries such as batteries, semiconductors, and solar products to address potential issues related to unfair competition and trade practices.
