Canada announced on Monday that it would impose a 100% tariff on Chinese electric vehicles (EVs) and a 25% tariff on imported steel and aluminum from China, following the actions of the United States and the European Union. These tariffs will apply to all EVs imported from China, including those produced by Tesla, according to a Canadian government official.
Shares of Tesla, the world’s most valuable automaker, dropped by 3% following the announcement. In 2023, Canadian imports of automobiles from China to Vancouver, the country’s largest port, surged by 460% after Tesla began shipping EVs made in Shanghai to Canada.
Prime Minister Justin Trudeau explained that the tariffs are in response to China’s state-directed overcapacity strategy. "I think we all know that China is not playing by the same rules," he told reporters. The tariffs will take effect on October 1.
Trudeau emphasized that Canada's actions align with those of other global economies. "What is important about this is we're doing it in alignment and in parallel with other economies around the world," he said during a closed-door cabinet meeting in Halifax, Nova Scotia.
The Chinese embassy in Ottawa was unavailable for comment. While China is Canada’s second-largest trading partner, the U.S. remains far ahead in trade relations.
Tesla does not disclose specific export numbers for its Chinese-made vehicles to Canada, but vehicle identification codes revealed that the Model 3 sedan and Model Y crossover models were being shipped from Shanghai to Canada.
"It is a 100% surtax on all Chinese-made EVs," the government official said, adding that if companies relocate production to another country, they would no longer be subject to the tariff.
