Canada exploring policies against ‘state-orchestrated’ oversaturation of Chinese EVs

Canada will take 30 days to explore new policy responses that could shield the country’s EV sector from becoming oversaturated by an excess supply of Chinese-made electric cars.

Finance Minister Chrystia Freeland called out China for allegedly undermining Canada’s EV industry with a deliberate “state-orchestrated” strategy of excess exportation that’s challenging Canadian EV manufacturing while visiting a factory in Vaughan, Monday.

“On July 2, we will launch a 30-day consultation on potential policy responses to protect Canada’s autoworkers, our growing EV industry, and to prevent trade diversion,” Freeland said.

Some of those policy ideas the government plans to explore include a possible surtax on imported Chinese EVs, changes to which cars are eligible for the federal EV rebate program and investment restrictions in Canada.

“Launching these consultations will help us work collaboratively with unions, with industry, and with all levels of government to develop options to make sure that Canada does not become a dumping round for Chinese oversupply,” she added.

This comes as several other international trade partners, including the U.S. and European Union, have taken action against “China’s unfair trade practices.”

The government cites China’s history of poor labour standards, weak environmental protection policies and substandard manufacturing as reasons that its trade practices are unfair.

The Deputy Prime Ministers office also drew attention to the potential risks Chinese-made EVs pose to Canada’s national security.

These risks stem from the data they collect from drivers and the lack of transparency regarding the ownership of said data.

“Today’s announcement underscores Canada’s unwavering commitment to safeguarding our auto sector, securing jobs, protecting rules-based trade, and promoting a competitive electric vehicle sector alongside a robust integrated supply chain,” Mary Ng, Canada’s  International Trade Minister, said.

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