Canada launches 30-day consultation to consider tariffs on electric vehicles imported from China

The only Chinese-made electric vehicles currently imported into Canada are from Tesla, and local Chinese-branded electric vehicles have yet to be sold in Canada.

Canada launched a 30-day consultation on July 2 as planned to discuss imposing restrictions, including additional tariffs, on electric vehicles (EVs) imported from China.

“As originally announced on June 24, 2024, Canada is today launching a 30-day consultation, from July 2, 2024 to August 1, 2024, on potential policy responses to protect Canada’s autoworkers and its growing electric vehicle industry from unfair trade practices, and prevent trade diversion resulting from recent actions by Canada’s trading partners,” Canada’s Department of Finance said in a July 2 news release.

The consultations aim to gather feedback on potential policy responses, including the imposition of a surcharge, as well as possible additional measures such as adjustments to the federal Zero-Emission Vehicle Incentive Program (iZEV) and investment restrictions, the statement said.

The consultations also aim to gather views on cybersecurity and data security as they relate to the protection of Canadians’ privacy and Canada’s national security interests, the statement said.

The Canadian government is also studying the outlook for policies that support China’s overcapacity and increased exports of electric vehicles, including labour and environmental standards, as well as unfair and untrade practices, the statement said.

Canada’s decision follows moves by the United States and the European Union to impose restrictions on Chinese electric vehicles.

The U.S. government announced in May that it plans to nearly quadruple tariffs on Chinese-made electric vehicles, with a final rate of up to 102.5%.

The European Union announced plans on June 12 to increase tariffs on Chinese electric vehicles, with some vehicles facing additional tariffs of up to 38.1% on top of the initial 10% tariff.

It is worth noting that the only Chinese-made electric vehicle currently being imported into Canada is that of American tech giant Tesla (NASDAQ: TSLA), manufactured at the company’s Shanghai plant. According to a report by Canadian channel CTV News last month, no Chinese-made electric vehicles are currently being sold or imported into Canada.

Tesla faces a 6% import tariff, which is currently the rate applied to any car made in China, but most models are getting a $5,000 rebate, according to CTV News.

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