Canada has announced it will impose a 100% tariff on imports of electric vehicles (EVs) made in China, following similar measures by the US and European Union.
Additionally, the country plans to implement a 25% duty on Chinese steel and aluminum.
Canada and its Western allies accuse China of subsidizing its EV industry, which they argue provides Chinese car manufacturers with an unfair competitive edge.
In response, China has condemned the tariffs as “trade protectionism” that “violates World Trade Organization rules.”
“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”, said Canadian Prime Minister Justin Trudeau.
Canada’s duties on Chinese EVs are due to come into effect on 1 October, while those on steel and aluminium will be implemented from 15 October.
A Chinese Commerce Ministry spokesperson said Canada’s actions “seriously undermine the global economic system, and economic and trade rules”.
“China urges the Canadian side to immediately correct its erroneous practices,” they added.
China is Canada’s second-largest trading partner, behind the US.
In May, the US said it would quadruple its tariffs on imports of Chinese EVs to 100%.
That was followed by the EU, which announced plans to impose duties on China-made EVs of up to 36.3%.
Canada’s tariffs on Chinese EVs will include those made by Tesla at its Shanghai factory.
“Tesla will almost certainly be lobbying the Canadian government to get some leeway on these tariffs, as they have already with Europe,” said Mark Rainford, a China-based car industry commentator.
“If they fail at mitigating the tariff enough, they’ll likely look at switching their Canadian imports to either the US or European factories since Canada is their 6th largest market this year and thus not insignificant.”
Tesla did not immediately respond to BBC News’ request for comment.
Earlier this month, the EU reduced its planned additional tariff on Teslas made in China by over 50%, following further investigations prompted by Elon Musk’s company.
Chinese car brands are still relatively rare in Canada, though some, such as BYD, have begun efforts to enter the Canadian market.
China, the world’s largest EV manufacturer, has rapidly captured a significant share of the global market.
In contrast, Canada has secured multi-billion-dollar agreements with major European car manufacturers as it aims to become a key player in the global EV industry.
Comments are closed.