“You’ll see more cars in terms of affordable vehicles coming from China into our market,” said Maninder Sidhu, International Trade Minister.
Canadians should expect an influx of affordable Chinese electric vehicles by early 2027 as manufacturers secure federal certification, The Globe and Mail reported. Under a trade deal struck this year, Prime Minister Mark Carney’s government broke with the United States by permitting up to 49,000 Chinese-made EVs into Canada under a reduced tariff rate of 6.1 per cent.
Both Canada and the United States initially slapped a 100-per-cent tariff on Chinese electric vehicles in 2024. The current Canadian quota is scheduled to rise annually, reaching 67,000 vehicles by 2031.
Global Affairs Canada data shows that roughly 16,200 Chinese-built EVs entered the country under the quota as of Sept. 30. The initial quota period runs through Feb. 28 next year.
Imports From Tesla and Lotus
Few actual Chinese-brand vehicles have arrived during the initial phase of the quota. Sidhu acknowledged that the majority of the quota used so far accounts for imports originating from U.S. automaker Tesla’s Chinese production plants.
A series of high-end vehicles from Lotus, a brand controlled by China’s Geely Group, also shipped to Canada earlier this year under the quota limits. Sidhu said that several Chinese EV makers are still undergoing the federal certification process for various models, with approvals expected to finish by the latter half of 2026.
Investment Talks in China
Despite strategic partnership announcements in January that anticipated Chinese auto investments in Canada within three years, no investments have occurred yet. Industry Minister Mélanie Joly met with four Chinese firms in June—BYD, Chery, Geely, and Shanghai Launch Automotive Technology—to discuss domestic manufacturing possibilities.
Shanghai Launch has floated a proposal involving a partnership with British automaker Austin Motor Co. Sidhu met with BYD, Chery, and Geely earlier this month during a trip to Asia to press manufacturers on utilizing local supply chains and domestic workers.
“My conversation with them was: ‘How are you going to utilize Canadian supply chains, Canadian workers, to eventually build those vehicles in Canada,’” Sidhu said.
He added that companies are still analyzing the domestic market before committing billion-dollar investments to open manufacturing plants. In the interim, Chinese carmakers are making smaller ancillary investments in charging infrastructure and dealership networks.
U.S. Trade Friction
Prime Minister Carney’s decision to admit Chinese EVs has drawn sharp criticism from Washington. The Trump administration has actively pressured both Canada and Mexico to align external tariffs against targeted Chinese imports.
“I think in the long run, they’re not going to like having made that deal,” said Jamieson Greer, U.S. Trade Representative, speaking to CNBC regarding Canada’s policy shift.
Common Questions About Chinese EVs in Canada
How many Chinese electric vehicles can enter Canada under the current trade deal?
Canada is allowing up to 49,000 Chinese-made EVs into the domestic market at a low tariff rate of 6.1 per cent. This quota is set to increase each year until it reaches 67,000 vehicles by 2031.
What accounts for the vehicles that have already entered Canada?
According to Global Affairs Canada, about 16,200 vehicles entered under the quota as of Sept. 30. Sidhu said that most of these imports reflect production from Tesla’s Chinese facilities alongside high-end Lotus vehicles owned by Geely Group.
Have any Chinese automakers committed to building manufacturing plants in Canada?
No final plant investments have materialized yet. While Industry Minister Mélanie Joly met with BYD, Chery, Geely, and Shanghai Launch Automotive Technology in June, Sidhu reported that the companies are still studying the Canadian market.