By Brian Platt | Bloomberg
Canada will impose new tariffs on Chinese-made electric vehicles, aluminum and steel, lining up behind western allies and taking steps to protect domestic manufacturers.
The government announced a 100% levy on electric cars and 25% on steel and aluminum. Prime Minister Justin Trudeau unveiled the policy Monday in Halifax, Nova Scotia, where he’s gathered with the rest of his cabinet for a series of meetings about the economy and foreign relations.
The surtax on electric vehicles will take effect Oct. 1 and will also include certain hybrid passenger automobiles, trucks, buses and delivery vans. It will be added to an existing 6.1% tariff that applies to Chinese EVs.
The levies on aluminum and steel will come into place Oct. 15. The government released an initial list of goods on Monday and the public will have a chance to comment before it is finalized on Oct. 1.
Trudeau’s government is also launching a new 30-day consultation on other sectors, including batteries and battery parts, semiconductors, solar products and critical minerals.
“We are transforming Canada’s automotive sector to be a global leader in building the vehicles of tomorrow,” Trudeau told reporters in Halifax.
“But actors like China have chosen to give themselves an unfair advantage in the global marketplace, compromising the security of our critical industries and displacing dedicated Canadian autos and metal workers.”
Canada, an export-driven economy that relies heavily on trade with the US, has been closely watching moves by the Biden administration to erect a much higher tariff wall against Chinese EVs, batteries, solar cells, steel and other products. Canada’s auto sector is highly integrated with that of its closest neighbor: The vast majority of its light vehicle production — which was 1.5 million units last year — is exported to the US.
Finance Minister Chrystia Freeland, the most powerful person in Trudeau’s cabinet, has been one of the most prominent voices in favor of a harder approach to Chinese vehicle exports, and becoming a closer trade ally with the US.
Freeland said in Halifax that the Chinese policy of oversupply was built on “abysmal” labor and environmental standards. “We are not going to build Canadian policy based on abuses of workers in China and based on pollution in China,” she said.
The government also announced it will limit eligibility for electric vehicle incentives to products made in countries that have negotiated free-trade agreements with Canada.
It will review the new levies within a year of them coming into effect.
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