EVwire brief: Canada Prime Minister, Mark Carney, signed a strategic partnership with China that reduces the current ~100% tariff down to 6.1% for 49,000 EVs per year. Note, that they call it a “preliminary but landmark” deal. That import number is set to increase to 70,000 by year five.
To put this to scale, in Q1-Q3 2025, Canada saw 82,695 new battery electric vehicles hit the roads, showing a notable decline from 140,531 on the same period in 2024, when the total year tally hit 202,333 BEV sales, which made up 10.9% of all car sales in Canada.
All this means that if the 49k cap is fully used in a year, which we humbly think it will, it could add up to 40% boost in EV sales for the year, given the current BEV sales rate in Canada. That is, of course, if these vehicles don’t eat up the sales share from non-Chinese EV makers.
The 6.1% tariff essentially returns the trade levels back to 2023, before the recent years of tariff actions begun. The Canadian side expects this olive branch will lead to considerable Chinese investment in Canada’s auto sector “within three years”.
Context: the agreement follows Prime Minister Mark Carney’s visit to Beijing, the first by a Canadian Prime Minister since 2017, where meetings were held with Chinese leadership including President Xi Jinping.
Prime Minister Mark Carney meets with President of China Xi Jinping | Sean Kilpatrick/The Canadian Press
Beijing has agreed in response to reduce its retaliatory tariff on imports of Canadian canola from a combined 85 percent duty rate to “approximately 15 percent” by March 1.
With this agreement, it is also anticipated that, in five years, more than 50% of these vehicles will be affordable EVs with an import price of less than $35,000, creating new lower-cost options for Canadian consumers.
During the visit, the Prime Minister met with Chinese clean-energy and EV business leaders to identify opportunities to accelerate investment aligned with these objectives.
SOURCE: Prime Minister of Canada web page; joint statement of the meeting; Politico
PS, We love it when fellow EV geeks surface the important EV news for us. Shoutout to Daria Sukhareva from kWwhat for letting us know of this one!
