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Canada Set to Side with China on EVs
- xrd 1y agoCan anyone elaborate on why Canada has 100% tariffs on EVs? I think I know why the US does: lobbying by American automakers. Did the US threaten Canada unless they followed suit a long time ago, and is this change a sign that leverage is now lost?
- 1970-01-01 1y agoBecause there are 0 Canadian EV manufacturers. Everything is (was) directly tied to the US strategy.
- infecto 1y agoCanada has something like 500k jobs tied up in the automobile industry. This plays a larger role in the decision than “US strategy” but I am assuming with this stupid trade war it can tip the balance to reducing that tariff.
- cmrdporcupine 1y agoCarney also has to play a balancing act of western vs central Canadian interests. Oil & gas & canola are on the table here, and it's a dangerous situation. If we lean hard into trying to prop up Ontario's auto-sector we cause a serious crisis for prairie canola farmers, etc. Both China and the US know this and are playing cat and mouse with us, fanning tensions, and the US is outright funding western separatists and encouraging grievance politics around their resource exports. The US has aggressively tariffed manufactured goods coming out of central Canada (and forestry out of BC) while leaving potash and oil & gas out of AB/SK untouched while simultaneously outright funding far right groups there that are are agitating against Canadian unity. At the same time China has slapped tariffs on canola and made it clear that EV tariffs are part of the calculus there. I don't see an easy way out of this. As a resident of Ontario I'd be sad to see the auto sector here go, and it would lead to massive economic devastation here ... but it feels entirely inevitable at this point. Not just because of tariffs but because the actual products from the Big3 automakers are increasingly mediocre and what they're producing here is on the whole not fine, sustainable, products anyways. Car parts, and Honda & Toyota plants are another story, maybe.
- ifwinterco 1y agoCanada has a large car industry itself - 100% might be excessive, but every western nation now faces a choice between tariffs on EVs or letting their car industry be completely eviscerated with hundreds of thousands of job losses
- WinstonSmith84 1y agothe third option is to force foreign companies to manufacture locally (which is often the case). It's kind of the best of both worlds.
- cmrdporcupine 1y agoWe don't really have that kind of leverage, and our domestic market isn't large enough to make it compelling.
- tokioyoyo 1y agoTo be fair, BYD has a bus plant in Newmarket.
- cmrdporcupine 1y agoOh, that's interesting, I had no idea. Neat.
- giarc 1y agoThe problem with that is our auto employee salaries would drive the cost of the vehicle up.
- nubinetwork 1y agoWe don't need to force anyone, toyota is happy making cars in Ontario. Kia/Hyundai/Hondas are everywhere on the road, all we needed to do is splash some incentive cash and we could cut out American automakers pretty quickly.
- teunispeters 1y agoPartially competition, as a couple of provinces have large car manufacturing. (Ontario and Quebec, mostly). Partially that there's no repair or maintenance infrastructure, nor guarantee a car will keep functioning if (say) the manufacturer shuts down or a model gets discontinued. As to how much of which, that's a good question, and not one I've seen any answers to.
- diego_moita 1y agoBecause the Canadian auto industry is twin-joined to the American auto industry. A lot of parts that go to the American cars are made in Ontario. Now, since his American majesty decided to throw away the Canadian auto industry we don't have anything to protect. Better to make deals with the Chinese now, before the whole American auto industry is destroyed.
- throwaway106382 1y agoBecause Biden told us to
- deleted 1y ago[deleted]
- throwaway106382 1y ago> Canada announced Monday it is launching a 100% tariff on imports of Chinese-made electric vehicles, matching U.S. tariffs imposed over what Western governments say are China’s subsidies that give its industry an unfair advantage. > The announcement came after encouragement by U.S. national security advisor Jake Sullivan during a meeting with Canadian Prime Minister Justin Trudeau and Cabinet ministers Sunday. - AP News, August 26, 2024 https://apnews.com/article/canada-china-evs-tariffs-0cd68ba7533bc6e7111cdd5811c8889c https://apnews.com/article/canada-china-evs-tariffs-0cd68ba7...
- zukzuk 1y agoThe Canadian and American automotive industry was (until very recently) tightly integrated. 1 in 10 American cars were made in Canada, with parts going back and forth across the border sometimes multiple times in the assembly chain. The automotive sector is also a significant portion of Ontario’s GDP. So a lot of incentive for Canada to side with America on this. But Trump blew up that relationship, and this is the consequence.
- helloooooooo 1y agoYou need to understand: for every tariff the US places on China, the more excess industrial capacity that China needs to direct elsewhere. It goes for steel, autos and more. This means, since America sanctioned Chinese steel, China has been dumping their steel into Canadian markets. With the excess electric car capacity unable to be absorbed by America, China wants to direct it elsewhere. If they start exporting to Canada, this excess capacity will completely destroy automotive manufacturing in Canada, leading to mass layoffs and entire industrial supply chains falling apart. This will inevitably lead to political instability as a large portion of second tier cities in Ontario start having a labour crisis. This is evidently not ideal. I bore witness to manufacturing completely leave my hometown, third tier city over the span of a decade. Today, there is little economic opportunity in that town, with massive drug abuse, and petty crime. It used to be a nice place, and working in a factory earned you an honest living. Unfettered trade with China killed places like this, destroying an entire generation. At the end of the day, wanting electric cars from China depends on your values, do you want incredibly cheap electric vehicles, even if it means destroying an entire industry that the largest province in the country relies upon? Or do you want to maintain a functional manufacturing base that is critical to political and social stability?
- petermcneeley 1y agoThe current Canadian prime minister is Mark Carney. He is an international banker. I think you have your answer. https://en.wikipedia.org/wiki/Mark_Carney https://en.wikipedia.org/wiki/Mark_Carney
- tharmas 1y agoand our other choice is PP, who is a career politician, who's achievements are what? I'm not happy about the choices. But c'mon PP?
- petermcneeley 1y agoI wouldnt suggest PP simply because such partisanship is beneath my intellect. The bank of Canada (head) again warned about the lack of productivity of the Canadian worker. I think Canada needs new leadership. Canada has had the same leadership for the last 10 years.
- jt2190 1y agoThe “U.S.” car industry is actually the North American car industry. Factories are in Canada, Mexico and the U.S. primarily and parts move across the border duty-free. This dates back to the Auto-pact. Canada almost certainly does not want to allow Chinese made vehicles to undercut their local producers. Any talk of this is just posturing and threats in the ongoing trade negotiations.
- wmoxam 1y agoTrump says he wants every car sold in the United States to be made domestically. The old integrated cross-border auto manufacturing system is over. Stellantis is already moving production of Jeep from Brampton to Illinois, and others are expected to follow.
- csomar 1y agoIt's a lapdog. You ask it to jump, it jumps. I guess not feeding him does make him rebel though.
- 1970-01-01 1y agoGood. There's nothing else stopping EVs from mass adoption besides these artificial barriers. You cannot undermine progress forever. I bet the auto factory workers are told they are supposed to feel upset about this. They should feel upset, because their government hasn't addressed the global shift to EVs sooner.
- helloooooooo 1y agoThis is the wrong take. Economic dependence on China is a massive national security threat. Exporting your manufacturing base to a nation that opposes the fundamental values of a nation is completely suicidal, and if war ever occurs, you’re toast. China is increasingly belligerent with their excess industrial capacity, engaging in dumping and overproducing to cut out competing non-Chinese manufacturers. They engage heavily in IP theft. Allowing critical manufacturing supply chains to move to China is stupid.
- watwut 1y agoThe problem is that as of now, the dependence on USA is more destabilizing. It is a country that has fundamental values difference against Canada, threatened Canada just recently and if war occurs, it is huge issue for Canada.
- Rover222 1y agoPalmer Lucky touched on this last week - how China would love to slowly winnow away American automobile manufacturing capacity, because that capacity would be converted to wartime production in the event of a large scale war.
- diego_moita 1y agoNot "set to", more like "considering to". But I very much hope we do it. Cons: it will probably be the death sentence to the Canadian auto industry. Pros: the gas engine auto industry is dying already anyway, with or without a deal with the Chinese. Besides, if we make the deal now, at least we can sell canola and pork to them.
- 1970-01-01 1y agoIt already has a death sentence on the calendar: 2035 This is a direct response to tariffs. Canada is done playing nice with its big jerk trading partner and will be opening its options to achieve this goal if the tariffs aren't lifted.
- danesparza 1y ago"its big jerk trading partner" = USA? It's not clear from that sentence who you mean, so I was clarifying.
- nickspacek 1y agoWorth considering at least, and looking at approaches like you mentioned and avoiding allowing free entry of foreign vehicles. We could consider partnerships (if China is interested) like we have with other foreign manufacturers like Honda and Toyota. We should also be considering expanding the existing relationships, though I'm sure there are retooling costs, and possibly playing hardball with other manufacturers to encourage them to setup shop (e.g. Kia/Hyundai). I doubt I'm offering anything that hasn't been part of discussions already, but having the ability to manufacture vehicles seems like an area of industrialization a country shouldn't part with lightly.
- cmrdporcupine 1y agoIt'd be nice to us dropping to 30% like the EU worked out with China... or even 50% if that is enough to get canola tariffs dropped. I drive a Polestar2, a Chinese (Geely) produced EV. The quality is good. The price for what it is... too high. And now most support for it is being dropped and sales networks in North America drying up because of these tariffs and political moves. How I'd love to see Geely set up a plant here.
- swader999 1y agoThis will be a boon for canola farming.
- wg0 1y agoBetter invite them to split production 50/50 on land.
- buyucu 1y agoGood. The Western world needs to get over its China-fetish.
- incomingpain 1y agoSo here's the thing. We dont have free trade with China and Auto manufacturing is something have the resources to do and export. The tariff will be something and it's going to be high because we protect our jobs and markets. Not to mention heavy investment from the government. Canada produces far more cars than we need for ourselves, it's an export focus. China then tariffed us on canola for example; but the Federal liberals arent going to melt down Ontario for the benefit a few thousand western farmers who will never vote liberal. Counterpoint though, stellantis and GM are essentially exitting Canada due to Trump. Essentially every single car manufacturer has commented they are exitting Canada and we're penalizing them all. Has trump forced us into the hands of China and Europe?
- tharmas 1y ago>Has trump forced us into the hands of China and Europe? Indeed. In order to get/keep Argentina out of the hands of the Chinese Trump gives them $40 Billion. A pretty risky venture considering their past record. I am aware that there are other reasons for the bailout (e.g. Citron hedge fund manager, who could lose a fortune, is a buddy of Bessant etc.). Canada on the other hand gets lots of bullying. The hegemonic goal of the USA is to control the Western hemisphere, yet Trump does everything to make the Canadians want to pivot towards China. Is that what the Geopolitical Elites in Washington want? Or is it a ploy, to push Canada into the hands of China, giving the USA an excuse to "take Canada over".
- bryanlarsen 1y ago100% tariffs are obviously political. OTOH, Europe has set their Chinese EV tariffs up at a defensible level. They're nominally set up in a way to offset subsidies. Canada should have set up its tariffs at the European level. Now it's probably too late, its a political football. Canada will either make a deal with China or the US in exchange for those tariffs.
- deleted 1y ago[deleted]
- infinet 1y agoCanada has an unique advantage in dealing with China that many don't realize or underestimate. Unlike many other countries, Canada holds a very special place for many Chinese people. Dr. Norman Bethune, who died during World War II while working in a field hospital, is a highly respected physician and a household name in China; There was a very catchy song from a Canadian potash TV commercial that many Chinese people remember from the early days when many Chinese watch the TV for the first time; Mark Henry Rowswell (aka Dashan) is perhaps the best-known stand-up comedian in China. Overall, I’d say Canada occupies a warm and special place in the hearts of Chinese people, including the age group of current administration. I don’t understand how the two countries have become hostile toward each other.