In January this year, Canadian Prime Minister Trudeau visited China, and both China and Canada reached consensus on a series of economic and trade issues. Canada has lifted the additional 100% tariffs imposed on imported Chinese electric vehicles. It will grant China a quota of 49,000 electric vehicles per year, with the vehicles enjoying a most-favored-nation tariff rate of 6.1%. The number of quotas will increase annually according to certain percentages.
Since Carney's visit to China, the United States has been closely monitoring developments in Chinese electric vehicles. According to a report by Bloomberg on June 17, Carney said during the G7 summit this week that U.S. President Donald Trump did not explicitly express his approval of the agreement reached between Canada and China regarding electric vehicles. However, Trump was satisfied with the arrangements, saying, "He really likes this framework."
During the G7 summit, neither Brian Kenney nor Donald Trump had a formal bilateral meeting. However, Kenney stated that both parties discussed "a wide range of topics" during the summit. At a meeting on June 16 local time, an unclosed microphone accidentally recorded the conversation between Kenney and Trump, during which they were discussing trade issues between Canada and China.
Khan explained the provisions in the agreement regarding quotas for imported Chinese electric vehicles. He said to Trump, “I think you will like this.” Trump seemed to agree, and responded, “That’s great.”
On the 17th local time, when asked about this conversation, Carney said that Trump asked relevant questions, so the two sides discussed this topic. Carney revealed, “He actually really liked this structure, and we had another conversation later.”
Regarding this, Trump commented in a media interview: "I don't know if I've said that I like this, but I can understand it. Would I prefer to see quota restrictions rather than no restrictions? Yes, that's what I think."
During the G7 summit, Canadian Prime Minister Justin Trudeau spoke with U.S. President Donald Trump.
Bloomberg pointed out that after Trudeau's visit to China, the economic and trade agreements reached between Canada and China were strongly criticized by the Trump administration. Since Canada is seeking to reduce tariffs on foreign-made cars, the China-Canada agreement remains a “sensitive topic” for the United States.
The Canadian government also hopes to establish joint Chinese-Canadian enterprises for the production of electric vehicles within Canada. Cani said that the agreement on electric vehicles “creates possibilities for Chinese investment in Canada, but it’s only a possibility; there’s no certainty yet.” He added that the investments he mentioned must involve “substantial production in Canada,” and Canada is not interested in assembly from imported components.
Canadian newspaper The Globe and Mail reported that Canadian Industry Minister Melanie Joly arrived in China on the 15th, kicking off a four-day visit. Part of the purpose of this visit is to meet with Chinese automakers in order to attract investment for Canada's automotive industry.
As Chinese electric vehicles enter the Canadian market, the American automotive industry and politicians are feeling anxious. In March of this year, several American automotive groups wrote to the Trump administration, calling on it to maintain restrictions on the import of Chinese cars. Subsequently, American politicians quickly followed suit, with bipartisan legislation even being introduced in both the House of Representatives and the Senate, aiming to legally ban the sale of Chinese cars.
However, Trump publicly stated in Detroit in January that “China’s automakers are welcome to invest and build factories in the United States.” Reuters analyzed that Chinese cars are cheaper, and many brands of Chinese cars are also more fashionable compared to Western traditional automakers. There is already a rift in the U.S.’s decision to ban Chinese cars from the market. Removing barriers for Chinese cars to enter the U.S. market may just be a matter of time and method.
