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⚡ This Week’s Big Charge
🇨🇦 Canada Opens The Door To Chinese EV Imports—What Does It Mean?
After all of the auto industry’s upheaval in 2025—policy resets, tariffs, strategy shuffles and so on—I was under the impression that 2026 would be some kind of “slowdown” year. Reader, that is not what has happened.
It’s now looking like this year will mark an inflection point for Chinese-made cars, specifically electric vehicles, in North America.
You likely know the reasons why a Chinese juggernaut like BYD can’t sell cars in the United States: stiff tariffs, restrictions on software on national security grounds, and general political pressure are the big ones.
Automakers from Germany, Japan and South Korea have had an export and manufacturing presence in the U.S. for decades. Unlike those nations, China is a geopolitical adversary, so few people have been willing to let its fast-growing auto sector set up a foothold here.
But in a break from U.S. automotive trade policy—fueled in part by their already fraying relationship—Canada struck a deal with China last week to allow cheap Chinese EVs in without the 100% tariffs it had previously imposed in solidarity with Washington. And Chinese EV imports are already dominating sales in Mexico, so this is certainly a signal of those companies gaining steam in North America.
So where does it all go from here? Let’s game it out.
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🛻 Scenario 1: It’s (Mostly) Fine, Because It’s Small—And Familiar
The deal that Canadian Prime Minister Mark Carney signed with Xi Jinping includes an initial annual cap of 49,000 EVs from China, which grows to about 70,000 over five years.
As part of the trade deal, 50% of the import quota will be priced at $35,000 Canadian (about $25,000 USD) or less as part of an affordability push.
Still, that’s not that many cars. About 1.8 million new ones are sold in Canada every year—this is a drop in the bucket.
It’s also what Canada allowed before 2024, when it increased anti-China tariffs to 100% with the U.S. In 2023, China exported 41,678 EVs to Canada.
And those weren’t even from Chinese brands: they were China-built exports from Tesla, Polestar, Volvo and so on. BYD only sells electric buses there.
So in this scenario, it’s not such a disruptive move. It’s mostly an avenue for familiar car brands to use their Chinese production more in the West. They’re already here, so what’s the harm in cheaper options, right?
But that’s only one way of looking at things.