As GM Authority has been feverishly covering, the Canadian government is considering the efficacy of implementing a tariff on Chinese electric vehicles, an important decision with BYD’s recent preparations to enter the Canadian market. With that in mind, it appears as though GM Canada is voicing its favor for the proposed tariffs.
According to a report from The Canadian Press, the Canadian federal government recently wrapped up a 30-day consultation on whether to follow the lead of the United States and European Union (EU) in applying hefty tariffs on Chinese EVs. Likely to little surprise, General Motors’ Canadian head has welcomed the idea of tariffs on such vehicles.
“We’re encouraged by the government’s examination of these issues,” GM Canada President Kristian Aquilina remarked. “Because on the basis of strong competition, a fair playing field, it encourages us to invest heavily, employ deeply. An unfair playing field can be quite detrimental, and it’s only right that the government look at these issues and consider all of the facts.”
Interestingly, the federal government actually announced that Canada’s automotive sector faces overwhelming competition due to China’s state-directed policy of overcapacity and broad range of non-market policies and practices. Beyond that, organizations like the Canadian Vehicle Manufacturers’ Association have made strong pushes for policies that would allow the more than $40 billion investments in Canadian EVs to succeed.
“This transition is happening, but it does take time, and we have to make sure that adequate supports are in place to allow these investments, and these new facilities to come online,” Canadian Vehicle Manufacturers’ Association President Brian Kingston noted. “Now is the time. Let’s put these policies in place, show the American people we are going to stand shoulder to shoulder with them in this approach to China.”
As a reminder, Chinese automaker BYD has recently had lobbyists working to register it with the federal and Ontario governments, and has also been meeting with Canadian dealerships to establish local dealer networks in anticipation of launching in the North American country.
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Comments
Many American and Japanese manufacturers that sell in North America have production facilities in Canada. If those companies fail due to market saturation, Canadian auto workers lose their jobs. Canada has much more to lose should the Chinese eliminate those jobs. Especially considering Canada is already experiencing an employment shortage.
They will need to do this here. Like Trump or not they need to do this or these cars will be dumped here at prices the American MFGS will never compete with do to higher labor costs.
Even if China builds these in Mexico they will enjoy much lower labor cost and it will damage a dying industry here if its not stopped.
I recall Trump talking tariffs causing the lefties in every corner of the country to blow gaskets and pop forehead veins….
This is simply a reaction to the inevitable.
I’ve said it before and I’ll say it again. The world is moving on with our without North America. China saw the writing on the wall over a decade ago and we dragged our feet and we are now paying the price.
Now we want tariffs so that North American and European manufacturers can catch up. Certainly many of these Chinese manufacturers have received unfair advantages due to significant state ownership and incentives. And that should be properly quantified and accounted for. But the blanket 50% tariff that is being applied in the US and Europe seems to be a lazy late reaction.
Truth is this tariff won’t do much anyway. Most of the Chinese companies will setup production in Mexico to get around it anyway.
Yesterday I read an article about Bangladesh’s prime minister exile which she left the country due to Bangla students protesting for freedom and liberties. A basic human right. And in that article, there were Weibo users praising the students for their bravery for standing up to their freedoms. There were however other users saying the opposite. And one comment put chills down my spine: “The only way to avoid this result is through iron-fist rule by a party representative of the people. Democracy and freedom accelerate a country’s self-destruction. They are the worst political system.”
I agree the west has been dragging their feet. And I would argue, the idea that we should help them prosper so they can democratize was simply dumbfounding. But if you think there won’t be consequences far greater than simply North America being left behind you are sadly mistaken. People better stop with this mentality that freedom and democracy is a given regardless of which country leads the world. Because right there, that comment, is what will be leading the human race. This is much more than just about economic prosperity. You enjoy being able to criticize Biden or Trump or whoever but I can promise you over there, you will not go unnoticed if you speak too much. And I have two colleagues one from college and one from work from native to that country who can vouch for that fact. A country under an “iron-fist rule” is not something I want to experience. My folks lived through such a rule. And it wasn’t pretty.
Would mandating vaccines, crazy EPA dictates, banning gas stoves, gas mowers, plastic straws, censorship, the Green New Deal, and a host of other particular party policies fall under the category of “iron-fist”? Just curious.
Oh I don’t disagree with you. And to add what I was saying above, and to your point, the influences has already started. Vaccine mandates, forced lockdowns with complete disregard to peoples livelihoods, forceful agenda-driven policies like the gas bans with no consideration to the science and potential costs to the people. And as for censorship? Well I cannot tell you how many times I have had comments on platforms like this one for speaking critical of a certain authoritarian government body in the east. And in the EU, anyone who speaks out against Israels actions in Gaza was crushed by French police. There are certainly people within our western elite that would love to take a few pages from that governments playbook. Xi did consider Bill Gates, one of the elites pushing for the mandate, a good friend. So believe me. The forces of democracy and freedom are weakening and we are allowing its demise.
Tariffs will only do so much, Mexico already imposed 40% tariffs on Chinese EVs, as part of their cooperation as a North American Country, expecting North American cooperation or solidarity between the 3 countries, and the answer to this was simply to set factories in Mexico, the same happened in Europe, BYD is now building their factory there, and even if they don’t have a factory in the desired region they have billions of dollars to subsidize their vehicles to make them competitive against North American vehicles.
Either we, as a region from Mexico to Canada start building better and cheaper EVs or we will be violently struck like our industries have never seen before, this will be just like what happened with the Japanese and then the Koreans, a tariffs was imposed with the chicken tax and then they started building them here, there is no way to escape, we have to be more competitive, more aggressive, faster and act with surgical precision because we like it or not, the next 10 years will be crucial for the survival of our region.
If you look for the main markets for NA vehicles such as the Suburban or the Silverado or even a newer vehicle like the Trax or the new gen Colorado, the rank always go the same way.
1. America
2. Mexico or Canada
3. Mexico or Canada
We have survived so many years because we as a region buy our own products here, because we built them to our needs, to our standards and sizes, however none of cars are competitive worldwide, we have to improve and prepare for the worst, aim for the head and do better, we can do it, we have done it the pass, we have to make better and more profitable cars.
Only then we’ll know if we survived.
The only way this nation can be competitive with China is to pay slave labor wages- end of story. It is hard enough filling fast-food jobs these days for $15 an hour. Do you know of anyone in this country who would be willing to work for $1 an hour in a factory?
There is absolutely NO WAY the US can build a competitive car when the Chinese enjoy such a huge advantage in labor. Couple that with the fact that there are far fewer regulations in China and Mexico, making the cost of building even cheaper.
We have nobody but ourselves to blame for this. The Chinese did what the Japanese did. Invite American companies to build vehicles in their country, learn through reverse engineering how to cheapen and perfect the building of their product, and then kick the Americans to the side.