As previously reported regards to Canada was considering imposing tariffs on Chinese electric vehicles (EVs), the country is now preparing to impose those tariffs on Chinese EVs.

This decision comes as the North American nation seeks to align itself with its major trade partners, the United States (U.S.) and the European Union (EU), who have already proposed or implemented new tariffs on Chinese EV imports.

As for Canada, the Canadian government, led by Prime Minister Justin Trudeau, is in the early stages of discussing how and when to proceed with these tariffs according to Bloomberg. Public consultations on the proposed measures are expected to start soon, signaling a potential shift in Canada’s trade policy towards Chinese EV manufacturers.

The move arrives from growing pressure from various quarters including Ontario Premier Doug Ford, who has been vocal in his support for matching or exceeding U.S. tariffs on Chinese imports, including a 100% tariff on Chinese EVs. Ford has argued in a post on his X account that China is “flooding the market with artificially cheap electric vehicles” by taking advantage of low labor standards and dirty energy practices.

Canada has seen a dramatic increase in Chinese EV imports, with values jumping up from 100 million CAD ($ 74 million) in 2022 to 2.2 billion ($1.6 billion) in 2023. This surge has raised concerns about the potential impact on Canada’s automotive market, which has secured major investments in EV and battery manufacturing over the past four years.

Canada’s auto industry has called on the government to impose these tariffs, arguing that the country cannot afford to be on the opposite side of this issue from the U.S., with which it shares several automotive supply chains. The industry fears that without such measures, Canada could become a loophole for Chinese automakers to enter the North American market according to Bloomberg.

Notably, Prime Minister Trudeau has not yet publicly announced to imposing tariffs, stating that his cabinet is closely monitoring the case. Interestingly, he mentioned having “significant conversations” about Chinese production at the recent G7 summit in Italy.

In terms of tariffs implemented on Chinese EVs, the U.S. has already raised tariffs on Chinese EVs from 25% to 100%, while the EU is set to implement tariffs of up to 38.1% on July 4. Furthermore, it is important to note that Chinese automakers such as BYD have already set up production plants in Mexico, embedding concerns into the U.S. and Canada.

As the EV industry closely observes Canada’s judgment on tariffs upon Chinese EVs, the implications for international trade relations, domestic job markets, and the automotive landscape in North America will be determined depending on their decision.

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