Canada Imposes New Tariffs on Chinese Electric Vehicles
On August 26, Canada announced that it would impose a 100 percent tariff on electric vehicles (EVs) made in China, effective October 1. This significant tariff applies to all EVs shipped from China, including passenger cars, trucks, buses, and vans. The new duty will be levied on top of the existing 6.1 percent tariff currently applied to Chinese-made EVs.
In addition to the EV tariffs, Canada will implement a 25 percent tariff on Chinese steel and aluminum starting October 15. This move may affect stainless steel products, auto parts, and more. Notably, these tariffs impact not only Chinese automakers but also American and European firms manufacturing EVs in China, such as Tesla, BMW, and Volkswagen. Canadian imports of automobiles from China to its largest port, Vancouver, surged by 460 percent year-on-year to 44,356 units in 2023, following Tesla’s initiation of Shanghai-made EV shipments to Canada.
Limited Impact on China’s EV Industry
Canada’s decision reflects a more protectionist stance in its trade policy, particularly concerning trade relations with China. These measures may have long-term implications for Canada’s economic interests, international image, consumer welfare, environmental goals, and the stability of global industrial and supply chains. Western media suggest that Canada is aligning with U.S. trade policy, aiming to pressure companies to relocate manufacturing back to the Americas under the concepts of “nearshore outsourcing” and “friendly shore outsourcing.”
However, imposing tariffs on China is unlikely to significantly enhance the competitiveness or market conditions of Canada’s auto manufacturing industry. The preliminary tariffs are not expected to considerably reduce the influx of Chinese EVs into the Canadian market. China’s EV industry has expressed minimal concern regarding the tariffs’ effects. Some exporters believe that the measures will have little impact on most Chinese firms. Many Chinese automakers are planning to expand their manufacturing and supply chains globally, a trend that may accelerate in response to the tariffs.
Reference(s):
cgtn.com
