Canada Sets Four Conditions to Lure Chinese EV Makers to Build Local Plants

Following her visit to China, Canadian Industry Minister Mélanie Joly stated that Chinese automakers seeking greater import quotas and lower tariffs for electric vehicles (EVs) must establish local manufacturing capacity in Canada. In January 2024, Canada allowed approximately 49,000 Chinese-made EVs to enter its market at a tariff rate of around 6%, eliminating the previous 100% tariff on such vehicles. During her trip, Joly met with Chinese automakers including BYD, Geely, and Chery to discuss potential investments in local production facilities and outlined four key cooperation requirements: 1. Assembly plants must be established as joint ventures, with Canadian partners holding majority ownership; 2. Chinese automakers must source components from Canadian suppliers rather than merely assembling complete vehicles locally; 3. Operations must comply with Canadian labor laws and employment standards; 4. Automakers must ensure the security of Canadian consumers’ personal data. The initiative aims to attract Chinese EV manufacturers to bring manufacturing capabilities and jobs to Canada, leveraging the country’s automotive industrial base to build production hubs serving global markets and reducing reliance on the U.S. market—currently, at least 70% of vehicles produced in Canada are exported to the United States, and high U.S. tariffs have already significantly impacted Canada’s auto industry.