Brian Kingston and David Adams
Canada’s auto industry is still trying to assess what the arrival of Chinese-built electric vehicles will mean for the market, even as Ottawa has begun to formalize how those vehicles could enter the country.
In interviews with Canadian auto dealer at the Vancouver International Auto Show, industry association leaders said significant questions remain despite the federal government’s latest policy update.
David Adams, President and CEO of Global Automakers of Canada, said the issue is more complex than the idea of new entrants alone, particularly given how integrated global supply chains have become.
“We have a number of members that are already sourcing vehicles from China,” said Adams. “So this isn’t just about new brands coming in, it’s also about how existing manufacturers are affected.”
Adams said his members are closely watching how the federal government intends to administer the new system, including how import permits will be allocated and whether the framework will evolve over time. “There’s still a lot we don’t know in terms of how this will actually work on the ground,” he said.
Brian Kingston, President and CEO of the Canadian Vehicle Manufacturers’ Association, raised broader concerns about competitiveness and alignment with key trading partners.
“We’ve been clear that Canada needs to remain aligned with the United States when it comes to trade policy in the auto sector,” said Kingston in an interview at the show. “That’s critical for maintaining an integrated North American market.”
Kingston said that alignment will become increasingly important as Canada heads toward the scheduled review of the Canada-United States-Mexico Agreement, raising concerns about how a divergent approach to Chinese EV imports could be received in Washington.
“We have to be mindful of how our policies are viewed by our largest trading partner,” he said. “The auto sector in North America is highly integrated, and decisions on one side of the border can have consequences across the system.”
Kingston said the current approach raises questions about consistency and long-term direction, particularly as governments weigh affordability, domestic investment and trade relationships. “This is a significant policy shift, and there are still important details that need to be clarified,” he said.
Those concerns come as Ottawa moves ahead with a newly defined import regime. Federal officials in late February issued notices through Global Affairs Canada and the Canada Border Services Agency establishing a permit-based quota system for Chinese-built EVs.
The measures, in force as of March 1, cap imports at roughly 49,000 units annually and require shipment-specific permits for each vehicle entering the country, replacing the 100 per cent surtax introduced in 2024.
Under the framework, an initial tranche of approximately 24,500 vehicles is being allocated on a first-come, first-served basis through the summer, with eligibility limited to Canadian-based importers and automakers. Vehicles entering under the quota are subject to the standard 6.1 per cent tariff.
For industry stakeholders, the structure signals a shift away from outright restriction toward a more managed form of competition — but without resolving key uncertainties around pricing, allocation and long-term policy direction.
Adams said those unknowns make it difficult for companies to plan. “Until we see how this is implemented and how it evolves, it’s hard to fully assess the impact.”
Kingston added that clarity will be critical as the industry navigates the transition. “We need to understand where this is going,” he said. “Right now, there are still a number of open questions.”
