Canada has imposed a 100% tariff on imports of Chinese electric vehicles in line with U.S. measures aimed at halting the influx of state-subsidized Chinese cars into North America.
Canadian Prime Minister Justin Trudeau accused China, one of the world’s largest exporters of electric vehicles, of not adhering to the same environmental and labor standards as other countries. Additionally, he announced an extra 25% tax on imports of steel and aluminum products from China. During a press conference in Halifax on the Atlantic coast, Trudeau stated that the overproduction of Chinese electric vehicles and the massive government subsidies to the automotive sector “require us to act.”
He added, “Unless we want to engage in a race to the bottom, we need to step up, and that’s what we’re doing.”
The additional tariff on electric vehicles will be imposed on top of the existing 6.1% tariff, starting October 1st, on Chinese electric vehicles, some hybrids, trucks, buses, and delivery vans.
In recent months, both the United States and the European Union have imposed tariffs on Chinese electric vehicles, at 100% and 38%, respectively.
Canada’s automotive manufacturing sector employs more than 125,000 people, and Ottawa has invested billions of dollars to support the transition to electric vehicles and secure a domestic supply chain for electric batteries.
The strategy, which has attracted companies like Goodyear Tires, Honda, Stellantis, Volkswagen, and others through subsidies, mirrors those implemented in neighboring United States, where the Inflation Reduction Act provided a wide range of incentives for the green industry.
Ottawa has also banned new Chinese investments in the critical mineral industry.