In response to the United States imposing new levies, Canada is contemplating increasing tariffs on Chinese-made electric vehicles (EVs). This move was discussed by Trade Minister Mary Ng in an interview with Bloomberg News.

While attending the Asia-Pacific Economic Cooperation forum meetings in Peru, Minister Ng emphasized the importance of coordination with U.S. trade strategies. “We are looking at this very carefully and we have an open dialogue with our American partners,” she stated, underscoring ongoing evaluations concerning trade with China.

U.S. Tariff Hikes Prompt Canadian Review

The potential for raised tariffs comes on the heels of U.S. President Joe Biden’s announcement of significant tariff increases on various Chinese imports, including electric-vehicle batteries, computer chips, and medical products. Promptly, China vowed retaliation against these new U.S. tariffs, which could further strain trade relations.

Under the Trade Act of 1974, Section 301, President Biden plans to escalate tariffs on EVs from 25% to 100%. This adjustment will bring the total duties on these products to 102.5%, a measure aimed at strengthening domestic industries and decreasing reliance on critical technological imports from China.

Impact on the Canadian Market

This consideration by Canada reflects the increasing presence of Chinese EVs in the North American market. Notably, Tesla has begun selling China-made Model 3 and Model Y vehicles in Canada through its website, signaling a significant penetration by Chinese automakers into Canadian markets.

As global economies engage in tightening trade measures amidst economic and geopolitical challenges, the EV sector remains a focal point due to its crucial role in advancing sustainable transportation. The implications of Canada’s potential tariff adjustments are significant, potentially affecting both the availability and pricing of Chinese EVs in North America.

In conclusion, Canada’s consideration of higher tariffs on Chinese-made EVs reflects a strategic alignment with U.S. trade policies amid rising economic tensions. As the North American market sees an influx of Chinese EVs, potential tariff hikes could significantly impact both pricing and availability, highlighting the delicate balance between fostering domestic industries and navigating international trade relations.

Image Source: Business Insider