Canada to Impose Tariffs on Chinese EVs, Battery Materials

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Canada is officially set to launch massive tariffs on electric vehicles (EVs) and battery materials from China later this year, following suit with the U.S. and others trying to bolster domestic supply chains.

Over the last couple of months, support has been mounting for Canadian lawmakers to impose tariffs on Chinese EVs after the U.S. and European Union (EU) both decided to do so earlier this year. Despite warnings from the Chinese government, Canada has decided to lodge the tariffs on the country’s EVs and some EV materials, on the heels of strong support for such action from the country’s largest labour union, Unifor, and several other organizations.

This week, the Canadian government officially announced plans to wage a 100-percent tariff on Chinese EVs being imported into the country, along with 25-percent tariffs on steel and aluminum, as detailed in a report from Automotive News. The announcement came as part of a visit to Halifax, Nova Scotia, where he shared the policy about foreign relations and the country’s economy ahead of meetings with his cabinet.

“I think we all know that China is not playing by the same rules,” Trudeau said during the announcement.

The Prime Minister also highlighted the importance of coordinating with other economies around the world and ensuring that customers worldwide weren’t being unfairly penalized by China’s market behavior.

The tariffs will go into effect in October, and the country is also considering tariffs on Chinese products such as chips, solar cells, and others.

One of many officials to support the plan was Canadian Finance Minister Chrystia Freeland, who supported the idea of bolstering ties with the U.S. in recent arguments in favour of the tariffs.

Freeland said in June that the Canadian automotive industry is “facing unfair competition from China’s intentional, state-directed policy of overcapacity that is undermining Canada’s EV sector’s ability to compete.”

The following month, Freeland even suggested broadening tariffs to include products beyond EVs, saying that “Geopolitics and geoeconomics are back.”

“That means that Western countries— and very much the U.S. — is putting a premium on secure supply chains and is taking a different attitude towards Chinese overcapacity,” she added.

Canada relies heavily on exports for its economy, and light vehicle production landed at 1.5 million units in 2023—most of which were exported to the U.S.

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