The trade war between Canada and the United States could get worse, putting American automakers in the crosshairs. President Trump has announced that he will impose 100 percent tariffs on Canadian goods if they proceed with their proposed trade deal with China.
1%. In return, Canada would allow up to 49,000 Chinese EVs to be imported annually, with plans to increase this number to around 70,000 units in the future.
The Canadian Vehicle Manufacturers' Association has expressed concerns that the deal could undermine the country's auto sector and disrupt the North American supply chain. Meanwhile, China is reportedly planning to make a 'considerable investment into Canada's auto sector' within three years, which may lead to some automakers setting up shop in the country.
As tensions rise, observers are pointing fingers at the Trump administration for souring the relationship between the US and Canada. With no deal in sight and an upcoming review of the USMCA, it appears that Canada has been effectively backed into a corner and is exploring alternative opportunities with China.
The proposed trade deal between Canada and China presents a complex web of risks and benefits for both countries. If not managed carefully, the increased Chinese EV imports could disrupt the North American supply chain and put Canadian automakers at a disadvantage.
