Carney government in talks with China over EV tariffs

Canadian negotiators are holding active discussions with China about lowering or dropping tariffs on Chinese-made electric vehicles in exchange for easing Chinese counter-tariffs on Canadian canola and seafood. Officials described the talks as politically sensitive and declined to say how they might affect relations with the United States.

Canadian officials say negotiators are in active discussions with China about reducing or removing tariffs on Chinese-made electric vehicles, while seeking relief from Chinese counter-tariffs on canola and seafood. The talks are taking place as Prime Minister Mark Carney prepares a two-day visit to Beijing that includes meetings with top Chinese leaders. The matter is politically sensitive because Canada matched U.S. tariffs on Chinese EVs in 2024 and Washington has been restrictive toward Chinese vehicles. Officials briefed reporters on condition of anonymity and gave limited detail about possible effects on Canada’s relationship with the United States. Developments: - Canadian negotiators are discussing lowering or dropping tariffs on Chinese-made electric vehicles in exchange for easing Chinese counter-tariffs on Canadian canola and seafood. - Officials described the discussions as ongoing and politically sensitive and declined to outline how the talks might affect relations with the United States. - Prime Minister Mark Carney’s two-day Beijing visit includes meetings with President Xi Jinping, Premier Li Qiang and the chairman of the National People’s Congress standing committee. - In the fall of 2024 Canada matched U.S. measures, imposing 100 per cent tariffs on Chinese electric vehicles and 25 per cent tariffs on Chinese steel and aluminum; China responded with counter-tariffs on canola oil and seafood. - Industry groups urged caution: the head of the Canadian Vehicle Manufacturers’ Association warned that removing EV tariffs could risk a backlash and harm the North American auto industry, and the head of the Canadian Auto Parts Manufacturers emphasized strict local-content standards. Summary: Officials said the discussions aim to address trade irritants on both sides and that the Carney visit provides an opportunity to make progress, but it is not expected to resolve all issues at once. What happens next will depend on the outcome of ministerial and official-level talks during and after the trip; the broader impact on Canada–U.S. trade relations is undetermined at this time.