Ottawa, Ontario — The Canadian government has announced that alongside imposing a 100 percent tariff on Chinese made electric vehicles, it will also be eliminating the $5,000 federal rebate typically available for electric vehicles.
In an announcement made earlier this month, Canadian Prime Minister Justin Trudeau stated that beginning October 1, 2024, the government will both impose the 100 percent tariff on Chinese made EVs and will also eliminate the $5,000 federal rebate.
Previously, Canada’s rebate was available to consumers purchasing EVs with no restrictions based on the country of origin. However, now, the rebate will only apply to vehicles manufactured in countries where Canada has a free trade agreement. As a result, only EVs from countries such as Japan, Korea and Europe will continue to be eligible.
Currently, only Tesla is impacted by the new measures as the automaker has been importing cars from China into Canada since last year after the United States imposed restrictions for its $7,500 tax credit, requiring that a percentage of materials in EV batteries come from the U.S. or countries in which the U.S. has a free trade agreement.
As noted by Drive Tesla Canada, since Canada had no restrictions at the time, Tesla decided to reserve production from Fremont and Giga Texas for the U.S. market and instead supply Canada with vehicles from Giga Shanghai.
With only a little less than a month until restrictions go into effect, Tesla will thus have little time to pivot to similarly providing vehicles to Canada from its Fremont-made cars.
