- Chinese EV makers prepare to enter Canada after tariff cuts.
- Several brands are already speaking with local dealership groups.
- Analysts say up to twenty Chinese automakers may arrive soon.
The Canadian government’s decision to ink a new trade deal with China and slash tariffs on Chinese-made EVs already appears to be paying dividends. The impact could arrive quickly. By the end of this year, three major Chinese carmakers may start selling vehicles in the Great White North.
It’s understood that BYD, Chery, and Geely have all started the process of certifying their vehicles for sale in Canada. At the same time, they are exploring the creation of retail networks and financial partnerships across the country, clearly viewing Canada as an important area for expansion.
Read: The Model 3 Could Be The Only Chinese EV Canadians Get
While its rivals remain quiet on their plans, AutoNews Canada reports that Chery has confirmed it’s “evaluating a range of potential pathways for future development, including partnerships with local stakeholders.” It added that the “priority is to ensure that any potential introduction is approached thoughtfully, with a strong focus on long-term sustainability, product competitiveness, and customer experience.”
The Canadian government has previously said it will help Chinese brands with “timely vehicle certification,” but even still, it’s possible it could take these firms upwards of a year to pass all regulatory hurdles.
Who Will Benefit First?
With this in mind, it’s highly unlikely these brands will benefit from the first quota of reduced 6.1 percent tariffs available from March 1 through the end of August, which is limited to just 24,500 permits. The permits will be distributed on a first-come, first-served basis and are expected to be quickly claimed by Tesla, Volvo, and Polestar.
Auto News reports that BYD and Geely are likely a step ahead of Chery. BYD had planned to enter Canada in the summer of 2024, but paused those plans when hefty new tariffs came into force. In addition, Geely already has a presence in Canada through the Volvo and Polestar brands. Its first all-in-house brand to launch in Canada could be Zeekr, which was trademarked locally last year.
Dealership Deals
The companies are not expected to sell vehicles directly to consumers and will likely pursue traditional dealership partnerships instead. According to Jason Zhao, director of Asian market development at DSMA, the trio is already in discussions with dealership groups.
Several other Chinese brands are also expected to expand into Canada in the coming years. Zhao believes as many as 15 to 20 car companies could enter the market in the near future.
