Canada’s commercial war with the United States has some economists who reflect on whether the federal government must relieve or lift its 100 percent tariff on Chinese electric vehicles, a movement that some say that EV purchases could stimulate and give a blow to Elon Musk’s Tesla.
Automobile manufacturers, however, say that rates are critical to protect the nascent EV industry of this country.
Canada followed the US. Uu. By slapping the rates in Chinese EVs the past autumn, while placing 25 percent of Sortox in imports of China’s steel and aluminum products.
That was before Donald Trump became president of the United States and hit Canada with a tariff storm, even on steel and aluminum used in the manufacture of vehicles.
Public opinion has also been grated in the Trump advisor and multimillionaire of Musk technology, whose teslas are the most selling EVs in Canada. Politicians have reflected on specific actions against Tesla, with NDP leader Jagmeet Singh and former liberal leadership candidate Chrystia Freeland launching 100 percent tariffs on vehicles.
Julian Karaguesian, economist and professor at McGill University in Montreal, said it is time to rethink tariffs on China.
“I think in silence, we are thinking of facilitating some of those measures. And I really think we should,” he said.
“If we wanted to have a specific response to the Trump administration to its greatest financial defender, we don’t have to American Tesla or EV rates … we would only have to take the tariff from the Chinese.”
Chinese manufacturer BYD debuted his SEAGULL EV last year at an initial price of approximately $ 14,600 CDN per range of 305 kilometers. The cheapest options available in Canada, on the contrary, Start at approximately $ 40,000.
Meanwhile, Canada’s tariffs have caused reprisals from China, where officials called them discriminatory and said “seriously violate the rules of the World Trade Organization.”
As of Thursday, the Chinese Ministry of Commerce has said that it will apply a 100 percent tariff on rapeseed oil, oil cakes and imports of Canadian peas, and a 25 percent duty on water products and Canadian pork meat, which causes important concerns for Canadian farmers.
This week, China will impose a 100 percent rate on canola in retaliation so that the Canadian government that puts a rate of Chinese electric vehicles. Jason Johnson is a grain farmer to the south of Morden, man. He says that the federal government has shown support to the steel industry against US tariffs, but nothing for farmers.
Karaguesian said that Canada could build its industry inviting Indian and Chinese manufacturers, together with US and European operators, to establish factories in Canada.
The idea of building a closer commercial relationship with China is still something taboo, he said, and some have been “horrified” when he suggested. But he argues that Canada’s position against China has been largely to appease the United States: “What commercial disputes do we have with China that are not manufactured in Washington?”
It can be time to stop worrying about the reprisals of the unpredictable neighbor of southern Canada, said Karaguesian, arguing that Trump and others in the United States government seem to see Canada more as a “vassal state” than a respected partner, a pattern that said long before Trump assumed the position.
“Let’s be just a sovereign nation, let’s pursue our own interests,” he said. “Because even when we do everything for them, I may not have any reward at all.”
Rates from Canadian car manufacturers
Automobile manufacturers in Canada have firmly remained in support of tariffs on China’s electric vehicles.
The president and CEO of the Association of Manufacturers of Canadian vehicles, Brian Kingston, said that tariffs on Chinese electric vehicles were “absolutely” the right decision and that the challenge raised by US tariffs on Canadian goods, which increase costs for consumers and threaten jobs in the automotive industry of Canada, have only strengthened that case.
Canada has attracted more than $ 46 billion in EV investments since 2020, according to a June 2024 report from the office of the parliamentary budget officer, and Kingston said that allowing Chinese EVs to flood the market would put those investments at risk, and the development of the entire industry.
“China has the capacity to build almost 80 percent of world demand for vehicles. There is a great risk if those vehicles flood the Canadian market,” he said.
Kingston said he is confident that Canada will be able to produce EV with a competitive price if he is given time to reach China.
“Americans love to drive larger vehicles, trucks and SUV. You are seeing electrified formats of those vehicles with larger and larger ranges,” he said. “So, yes, the options for Canadians are improving every day, and prices over time will become increasingly competitive.”
David Adams, president and CEO of Canada’s global car manufacturers, said that opening the doors to Chinese EVs would now make Canada’s investments in the sector do not make sense, because Chinese vehicles would take care of the market.
“The new tariffs of the United States certainly confuse the waters a bit, but do not undermine the fundamental reason why these rates were implemented,” he said.
Hugo Cordeau, a doctoral candidate at Economics at the University of Toronto who investigates climatic policies, said he cares about a possible reaction from the US. If Canada returned to their tariffs on Chinese EVs.
He said there may be a middle ground, noting that the European Union adopted a more “sensible” approach by increasing its surface in Chinese electric vehicles 10 percent to 45 percent and encouraging Chinese companies to open factories in Europe.
“I think it’s just a double -edged sword. I think we were initially bad, I think we should have gone with the EU,” said Cordeau. “I think there is probably time to align with the EU without the 100 percent that politics falls.”
The reduction of prices in cheap EVs would be “excellent” for Canadian consumers, he said, arguing that in the long run, allowing more competition would also be good for the Canadian automotive industry, which until now has focused on high -end EVs.
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Canada still ‘at the mercy’ of us, says the professor
Sumeet Gulati, a professor in Environmental Economics and Resources at the University of British Columbia in Vancouver, said that allowing the cheapest Chinese vehicles in the market can also stimulate more load stations, whose lack is considered one of the greatest dissuasions for consumers who consider buying an EV.
He said that if the federal government is below its goal to gradually eliminate car sales and gasoline trucks by 2035, you will have to communicate with other countries for more electric vehicles to help Canada achieve its goal.
But Gulati said that although it was disappointed by the announcement of the federal government of tariffs on China, the past fall understood the movement due to how integrated the Canadian and American car industries are.
“I don’t think we have another option because we have this strictly integrated market,” he said.
For now, said Gulati, Canada should wait about six months for the tariff war to appear before admitting that the Canadian and American automotive industries have been “decoupled.”
“I think we are at this time, unfortunately, at the mercy of what the United States government does,” he said.
