Canada has officially removed 100% EV tariffs on Chinese-made electric vehicles. The move is expected to boost sales for Tesla and other EV manufacturers.
Industry experts say Tesla is set to benefit the most. The company ships cars from its Shanghai factory to Canada and has a strong sales network across the country.
The new policy allows Canada to import up to 49,000 EVs annually from China at a 6.1% tariff under most-favored nation terms. Prime Minister Mark Carney said the quota could rise to 70,000 vehicles within five years.
Half of the quota is reserved for EVs priced under 35,000 CAD ($25,189). This excludes Tesla models but opens opportunities for other manufacturers.
Tesla has an advantage due to its Shanghai plant. The facility produces Canada-specific Model Y vehicles efficiently. In 2023, Tesla began shipping Model Y cars from Shanghai, increasing imports to Vancouver by 460% year on year.
Tariffs in 2024 temporarily halted shipments. Tesla then started exporting Model Ys from its Berlin plant. The company’s affordable Model 3, however, continues to be mostly built in China.
Experts say Tesla’s network of 39 stores across Canada strengthens its position. Competing Chinese EV makers like BYD and Nio have limited or no sales presence in the country.
The removal of 100% EV tariffs is expected to make EV imports more affordable. It could also encourage other automakers to enter the Canadian market.
Analysts note that Canadian EV buyers may see a wider selection of vehicles and competitive prices. Tesla’s established logistics and service network gives it a clear edge.
Canadian authorities see this move to support EV adoption. The policy aligns with goals to increase green vehicle usage.
For related updates on technology tariffs, read our report on AI Chips Face 25% Tariff Under Trump’s New Policy.
China-based automakers are now evaluating how to expand sales under the new tariff rules. Some are adjusting production to meet Canada-specific demand.
Tesla is likely to accelerate Model Y and Model 3 shipments. The company’s experience with international logistics makes it ready to respond quickly.
Market observers predict that Canada’s decision could strengthen ties with Chinese EV manufacturers. It also enhances Tesla’s strategic presence in North America.
Overall, ending 100% EV tariffs is a major step toward expanding electric vehicle accessibility in Canada. It strengthens competition while supporting Tesla’s growth.
