Canada is rumored to remove tariffs on Chinese electric cars soon, as Prime Minister Mark Carney is set to meet with Chinese President Xi Jinping later this week.
This would likely lead to the biggest shake-up in the EV space in North America after the US killing its EV incentives.
Last year, Canada followed the US in imposing 100% tariffs on electric vehicles coming from China.
In hindsight, it was a short-sighted move as it mainly helped the US auto industry while the US government quickly turned hostile on trade with its northern neighbor.
With little progress in trade negotiations with the US, there has been an expectation that Canada would reverse its tariffs on Chinese EVs.
Rumors have been increasing lately amid new developments.
First off, President Trump announced last weekend that he had shut down trade talks with Canada because he was upset that Ontario ran ads featuring President Reagan criticizing tariffs. He suggested that this was inaccurate and the Canadian province might even have used AI to fake the comments. That’s false. Reagan did dislike tariffs, and the video was legitimate.
On the Canadian side, Prime Minister Mark Carney will meet with President Xi Jinping this week at the Asia-Pacific Economic Cooperation (APEC) summit in South Korea.
There are rumors that the two countries might use the opportunity to sign new trade deals.
In China, the rumors point to the country removing restrictions on Canadian canola and pork in exchange for Canada eliminating tariffs on Chinese EVs.
Electrek’s Take
In the short term, the biggest winner would be Tesla, which would resume delivering cars made in Shanghai to Canada.
EV supply has been lower since the tariffs, and things accelerated quickly this year after incentives were paused and new tariffs on US EVs.
Tesla has been sending Model Ys from Germany instead, but more variants are being built in China, and it would also enable cheaper Model 3s to hit the Canadian market.
Mid to long-term, it would be a big win for consumers, as some Chinese automakers could decide to launch in Canada, and we would get access to some amazing cars at reasonable prices.
In fact, I’m going back to China next week. I should test out a few of those new Chinese EVs, and I’m sure, like last time, I will want to bring them back with me.
