Canada announces tariffs on electric vehicles made in China

Canadian Prime Minister Justin Trudeau announced at a federal cabinet retreat in Halifax on Monday that Canada will impose tariffs on Chinese-made electric vehicles. Trudeau and his cabinet reportedly heard from Jake Sullivan, President Biden’s national security advisor, late Sunday during a surprise visit ahead of his trip to China. In the U.S., both presidential candidates have indicated they support tariffs on China-made imports.

Trudeau said a 100% surtax will be levied on all Chinese-made EVs, effective October 1. The tariff will apply to electric and certain hybrid passenger automobiles, trucks, buses and delivery vans. The main reason for the tariff decision is that the large subsidies going into the Chinese electric vehicle industry are seen eliminating the level playing field.

Currently, Tesla (NASDAQ:TSLA) is the only electric vehicle maker that exports China-made EVs into the nation. However, an escalating trade war globally could impact Nio (NYSE:NIO), Li Auto (NASDAQ:LI), XPeng (NYSE:XPEV), ZEEKR Intelligent (ZK), and BYD Company (OTCPK:BYDDF).