Canada looks set to follow the lead of the US in imposing 100% tariffs on imports of China-made electric vehicles, raising doubts over BYD’s expansion plans there.
The move is the latest pushback on the advance of Chinese EVs into Western markets following Europe’s recently announced variable tariffs and comes alongside 25% duties on Chinese steel and aluminium as well.
Canada’s auto industry produces almost two million cars per year and employs around 125,000 people, primarily for American and Japanese automakers, and the Canadian Prime Minister, at least publicly, is using this as the reasoning.
Prime Minister Trudeau said: “We are transforming Canada’s automotive sector to be a global leader in building the vehicles of tomorrow, but actors like China have chosen to give themselves an unfair advantage in the global marketplace”.
Whether this is an active call for Chinese automakers to build in Canada remains to be seen, though with a new BYD factory being built in Mexico it seems unlikely they’d be the first choice.
The 100% tariffs come on top of the existing 6.1% import tariff and look set to also affect non-Chinese brands, including Tesla, which currently imports Model 3 and Model Y cars built in the Shanghai factory.
China has reacted to the tariffs, stating that they “seriously undermine the global economic system, and economic and trade rules”, asking Canada to correct the move.
As Canada’s second-largest trading partner after the US, China may well find numerous options for retaliation should the Canadians maintain their stance on the issue.
