Clean Energy Canada urges lower tariffs on Chinese EVs

An environmentalist non-governmental organization is calling on the federal government to reduce tariffs on Chinese-made electric vehicles, arguing the move is necessary to deliver affordable options.

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An environmentalist non-governmental organization is calling on the federal government to reduce tariffs on Chinese-made electric vehicles, arguing the move is necessary to deliver affordable options to Canadians and to meet future EV adoption goals.

In a Thursday news release, Clean Energy Canada urged Ottawa to reconsider its trade policy by lowering import duties on Chinese EVs and allowing a limited quota of vehicles from China to enter the Canadian market.

The organization says such a move would help fill market gaps, increase consumer choice, and reduce prices for drivers facing high transportation costs.

“Doing so would open Canada’s vehicle market to fill important market gaps, drive innovation and ultimately make our auto sector more competitive,” the group stated.

The policy call comes as the federal government considers updating its Electric Vehicle Availability Standard, a regulation that mandates automakers sell a rising share of zero-emission vehicles over the next decade, concluding with a full ban on new internal combustion engine sales by 2035.

Clean Energy Canada argues that the standard must be supported by a broader affordability package to be effective, including revisiting current tariff structures.

Currently, tariffs on Chinese-made EVs can reach 6.1 per cent under the Most-Favoured-Nation, a schedule of tariffs that applies to imports from member nations of the World Trade Organization, which Canada, in principle, treats equally.

Chinese automakers, such as BYD and NIO, have ramped up EV production and aggressively entered markets across Europe, Southeast Asia and Latin America, often offering vehicles at significantly lower price points than North American or European competitors.

Clean Energy Canada is also calling for Ottawa to increase funding for the federal EV rebate program and introduce a price cap favouring models under $40,000.

Canada is currently seeing a decline in EV sales, which dropped to 6.5 per cent of all new vehicles sold in March, down from 13.8 per cent last year.

It warns that without swift policy action, Canada risks falling behind global trends.

“Canada must now decide whether to follow the path of the U.S. in becoming an island of fossil-fuel-powered and aging technologies, or chart a course that better aligns with global direction,” the group said.

The call to reduce tariffs could intensify tensions with Canadian automakers, who last week pleaded with Prime Minister Mark Carney to scrap the federal zero-emissions mandate.

Last year, UNIFOR applauded the federal government for applying tariffs on Chinese EVs, which it described as “actions to address the structural trade imbalance with China” and “establish temporary guardrails for jobs and industries.”

Representatives from Ford, General Motors and Stellantis have warned that sales targets are increasingly out of reach amid declining demand and rising input costs.

Jim Farley, Ford’s CEO, spoke on Sunday at the Aspen Ideas Festival, where he called China’s rapid rise in the EV market “the most humbling experience” of his career.

“Their cost, their quality of their vehicles is far superior to what I see in the West,” Farley said.

He warned that if the United States and the West lost the competitive battle with China, not just in EVs but in technology, Ford would not exist in the future.