Canada Considers Surtax on Chinese-Made EVs Amid Global Oversupply

Canada is exploring a surtax on Chinese-made electric vehicles due to an oversupply issue. The 30-day consultation starting July 2 will examine unfair practices and consider changes to EV purchase rebates. Deputy Prime Minister Chrystia Freeland emphasizes support for Canadian jobs and coordinated action with global allies.

Canada's government is weighing the imposition of a surtax on imports of Chinese-made electric vehicles, initiating a 30-day consultation on July 2 in response to what Deputy Prime Minister Chrystia Freeland describes as a deliberate effort by Chinese firms to create a global oversupply.

This investigation follows recent announcements from the United States and the European Commission regarding increased import tariffs on Chinese EVs set for this summer.

Freeland highlighted the importance of the domestic automotive sector, which supports approximately 550,000 well-paying Canadian jobs. She expressed concern over unfair competition from China's state-directed overcapacity policy, jeopardizing Canada's ability to compete in both domestic and global EV markets. The consultation will seek insights into the drivers behind China's surging EV exports, including unfair market practices, labor, and environmental norms.

Furthermore, the consultation will explore potential changes to the eligibility criteria for the federal EV purchase rebate valued up to 5,000 Canadian dollars per vehicle and consider expanding investment restrictions. Freeland committed to aligning Canada's actions with those of its allies in the US and the European Union, ensuring Canada does not become a 'dumping ground' for Chinese EV oversupply. US President Joe Biden has indicated that Chinese subsidies for EVs and other consumer goods unfairly advantage Chinese companies in the global market.

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