The recent reduction in tariffs is expected to significantly lower the cost of importing Chinese cars to Canada. This development raises questions about the impact on EV sales and the readiness of Canada’s charging infrastructure and power grid to accommodate more electric vehicles.
Experts analyzing the EV transition in Canada suggest that while the influx of Chinese EVs is anticipated, it is essential to consider the current state of charging and grid infrastructure. Despite some gaps and challenges that need addressing as Canada’s EV fleet expands, the infrastructure is generally capable of handling the increased demand.
Under the new agreement, China can now export up to 49,000 EVs annually to Canada at a reduced tariff rate of 6.1%, down from 100%. This adjustment is expected to make Chinese EVs more accessible to Canadian consumers at a more competitive price point.
The number of Chinese EVs entering the Canadian market is relatively modest, representing around 3% of annual auto sales. This figure aligns with the number of Chinese EVs sold in Canada between 2023 and 2024 before the imposition of the 100% tariff. Additionally, these imports make up only 19% of the 264,000 zero-emission vehicles sold in Canada in 2024, indicating that the majority of EVs are still sourced from other regions.
Lindsay Wiginton, from energy and climate consulting firm Dunsky, noted that Chinese imports could have a notable impact on EV sales in Canada. However, existing projections suggest a substantial growth in EV sales by 2040, with an estimated four out of five light-duty vehicles sold being zero-emission vehicles.
The arrival of Chinese EVs could influence the EV market in Canada, potentially offering more affordable options and introducing new brands to consumers. The availability of lower-cost Chinese vehicles in other regions has stimulated competition and increased the range of affordable EV options.
While the current public charging infrastructure in Canada is deemed sufficient to accommodate additional EVs, there are still gaps in remote areas and multi-unit residential buildings that need to be addressed. Access to home charging remains crucial for EV adoption, especially in urban areas with limited infrastructure.
Overall, the integration of more Chinese EVs into the market may lead to lower prices for used EVs, attracting a broader segment of buyers. The impact on the grid is expected to be manageable, with EV charging offering opportunities for more efficient use of existing infrastructure and potentially reducing electricity costs.
Government policies, such as the ZEV Availability Standard, play a crucial role in providing utilities with market certainty and guiding infrastructure investments to support the growing EV market in Canada.
