Canada to follow U.S., Europe with announcement on tariff plan for Chinese EV, battery imports

Finance Minister Chrystia Freeland is expected to announce this morning a plan for potential tariffs to protect Canada's electric vehicle supply chain from unfair Chinese competition.

Freeland and International Trade Minister Mary Ng are making a joint announcement on Monday morning following moves this spring by both the United States and Europe to hike import tariffs on Chinese-made EVs.

Before Canada can impose new tariffs, an anti-subsidy investigation must be completed by the Canadian International Trade Tribunal.

Currently, the only Chinese-made EVs imported into Canada are Teslas made at the U.S. tech giant's Shanghai factory.

China is a bigger player in Canada when it comes to batteries and battery components for EVs, industries Canada has invested heavily in over the last four years.

In 2021, almost 80 per cent of all lithium-ion batteries for electric vehicles globally came out of China and the International Energy Agency says almost 60 per cent of global EV sales are now Chinese-made.

Accusations that China has spurred its own EV industry through unfair subsidies led to both Europe and the U.S. retaliating this spring.

Many EVs from China cheaper than Europe-made models

U.S. President Joe Biden announced in mid-May that he is hiking tariffs on Chinese EVs from 25 per cent to 100 per cent this year, though there is only one Chinese EV currently available in the U.S.

Biden also announced a hike to tariffs on lithium-ion batteries and some other clean energy products including solar cells.

The European Commission is still completing its anti-subsidy investigation but announced two weeks ago that it will impose provisional tariffs of between 17 per cent and 38 per cent on Chinese-made EVs as of July 4.

That plan could change