Canada to Impose Sweeping Tariffs on Chinese Goods, Including Electric Vehicles

Canada has announced plans to impose a 100% tariff on all electric vehicles (EVs) imported from China, alongside a 25% tariff on Chinese steel and aluminum. This move mirrors recent actions taken by the United States and the European Union.

According to Reuters, the tariffs will affect all EVs shipped from China, including those produced by Tesla. The announcement led to a 3% drop in shares of the world’s leading automaker. Last year, Canadian imports of Chinese automobiles surged by 460% at Vancouver, the country’s largest port, following Tesla’s increase in shipments of Shanghai-made EVs to Canada.

Canadian Prime Minister Justin Trudeau stated that the tariffs, effective from October 1, are aimed at countering what he described as China’s deliberate policy of over-capacity. “China is not playing by the same rules,” Trudeau remarked during a closed-door cabinet meeting in Halifax, Nova Scotia. He emphasized that Canada’s actions are aligned with global economic strategies, noting the coordinated approach with other major economies.

Related: EU to Impose Up to 38.1% Tariffs on Chinese Electric Vehicles

The move comes amid increasing trade tensions, with China being Canada’s second-largest trading partner, though it remains far behind the United States. Although Tesla does not publicly disclose its Chinese exports to Canada, records indicate that the Model 3 sedan and Model Y crossover are among the vehicles being exported from Shanghai.

While the Chinese embassy in Ottawa was unavailable for immediate comment, Trudeau indicated that Canada will continue to collaborate with the U.S. and other allies to address non-market practices by countries like China. He also hinted at potential future measures, such as tariffs on chips and solar cells, but provided no specifics.

This decision follows a similar stance taken by U.S. President Joe Biden in May, who announced a substantial increase in tariffs on Chinese EVs, semiconductors, solar cells, and other strategic goods to protect domestic industries from Chinese excess production.

Source: Reuters