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Canada Mulls Tariffs on Chinese EV Amid Global Pressure

Daniel Kim Views  

On the 20th, Bloomberg reported that the Canadian government is considering imposing tariffs on Chinese electric vehicles (EV), following the United States and the European Union (EU) lead.

A cabinet member from Prime Minister Justin Trudeau’s government stated they “still have to make final decisions on how to proceed, but it’s likely to announce soon the start of public consultations on tariffs that would hit Chinese exports of EVs into Canada.”

Canada has faced domestic and international pressure to join U.S. policy after President Joe Biden announced last month that tariffs on Chinese EVs would be raised to 102.5%, nearly four times the current rate. Following the U.S.’s lead, the EU also revealed plans last week to impose up to 48% tariffs on certain Chinese EVs.

Western countries, including the U.S., believe China’s overproduction threatens their industries by dominating the global supply chain.

Ontario Premier Doug Ford called on the Trudeau government to consider imposing tariffs at least on par with the U.S., stating, “China is using low labor standards and dirty energy to produce cheap electric vehicles.” He also warned on the social media platform X (formerly Twitter), “Unless we act fast, we risk Ontario and Canadian jobs.” Canadian auto industry groups also call for a stance similar to the U.S., considering the North American Free Trade Agreement (NAFTA).

The number of Chinese EVs shipped to Canada last year increased fivefold from the previous year to 44,000 units, influenced by Tesla’s decision to start shipping Model Y vehicles made in Shanghai to Canada.

Bloomberg reported that Trudeau has been cautious despite this domestic and international pressure, citing the possibility of trade retaliation from China. While he has publicly mentioned that the Canadian government is watching other countries’ responses, he did not mention new tariffs. Some groups, including environmental organizations, argue that maintaining low costs for EVs is crucial for expanding their distribution.

Daniel Kim
content@viewusglobal.com

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