the federal government says it is considering slapping AER tax on Imports of electric vehicles made in China they are flooding the global market right now thanks to subsidies from the Chinese government Katherine Cullen has more the most important people here today surrounded by Autos sector workers Christia Freeland pledged to push back against China for them starting with consultations on just how strong that push back should be we are going to protect you and defend you from unfair competition but the pledge to stop an oversupply of Chinese made vehicles from flooding Canada is also about domestic and international pressures the government clearly had no choice China clearly has a leg up on the competition because of all the subsidies that they have given to their industry a threat when Canada’s government has invested tens of billions in the sector uh we have been working tirelessly at this there’s also a concern about keeping up with allies earlier this month the Europe European Union hit Chinese vehicles with new tariffs of up to 38% and in May the United States leveled a tariff of 100% while slamming Chinese economic practices it’s not competition it’s cheating China’s government has firmly rejected allegations it’s behaving unfairly describing the EU accusations as being without factual and legal basis next week Canada’s government will begin a 30-day consultation about how to proceed nothing is ruled out and all possible tools are on the table but what about the fact that the Canadian government wants Canadians to switch over to EVs and China is supplying them we also do not believe that the path to climate action is based on production which is made using low environmental standards using low labor standards and potentially threatening our security Freeland was asked about the potential that China could hit back with economic sanctions of its own she says the government will take that into consideration but it needs to defend Canada’s national interest kathern Cullen CBC News Ottawa for more on how this could affect the Auto industry I’m joined Now by Brian Kingson the president and CEO of the Canadian vehicle manufacturers Association Brian Kingson it’s good to see you again good to see you so the 30-day consultation will start on July 2nd I mean we could be a little over a month away from a trade war with China is this what the industry needs yeah I mean this is a step in the right direction because we know that China has capacity now to satisfy domestic demand twice over and we’ve seen what happens in other markets the European Union is a good example where their market share may go almost to 25% in very short order so action is required and it’s good that the federal government has recognized this and is now launching a process to make sure that we have the tools available to protect our market and build out our EV supply chain are are you worried mostly about Chinese own companies that make vehicles or like because Tesla is making things at its gigaplant in Shanghai I mean what’s the bigger concern here uh anything that is manufactured in China that has been benefiting from these subsidies I mean the recent estimates are that uh the Chinese EV industry has received over $230 billion dollar in government subsidies going back about 15 years these are unprecedented amounts of money which have supported the development and the capacity of this industry we cannot particularly the time when Canada is investing in the industry here to employ Canadians over 40 billion dollars in new investment we not allow that to undermine this supply chain but one country subsidy is another country’s investment right I mean we’ve got the inflation reduction act happening in the United States which is production subsidies at the back end the deals here with stantis you know LG with Volkswagen how how is this different in terms of uh trade practice if you look at the subsidies and the supports that have been rolled out across North America to build this supply chain it pales in comparison to what China has done if you go back to 2015 made in China 2025 was their industrial policy and it made it Crystal Clear they want to dominate the global EV market and that is now coming to fruition we have an opportunity here that is unprecedented because of our critical minerals because of our existing automotive industry we can be part of this emerging North American EV supply chain but if we allow non-market economies to come in and undermine that we’re going to put all that investment at risk well that’s the key thing non-market economies right the free market Reigns in in Canada the US Europe and China is a a state controlled uh economy but you know where where do you think Canada should go with this I mean Joe Biden’s looking at 100% tariff Europe’s is lower I think capping out at about 38 and there’s going to be retaliation and push back from China where would you recommend Canada goes I’d like to see uh a number of actions I mean the Tariff is the most obvious uh instrument it’s a blunt instrument um but we do have to make sure the Americans know that we are aligned with them on the approach to China but there are other policies that we should be looking at Canada has a disconnect right now between its environmental policies and its industrial policy we have an EV man mate that has no concern whatsoever for where those EVS are manufactured that’s a problem uh we have a purchase incentive program which is subsidizing to a huge extent Chinese manufactured vehicles that should be looked at and there are real security concerns about these vehicles and how this information’s gathered okay well yes I I talked to Vic fidelli about this he said these are computers on Wheels and where do you want those computers made is part of his concern but the incentives right now it’s a $5,000 regardless of where the electric vehicle is made so do you want that increase or say increase for North americanmade or just reserved exclusively for North americanmade Vehicles yeah I think we should take a page out of the Americans book on this one if you look at what the Biden Administration has done with the inflation reduction act they have tied everything to supporting the US industry and the broader North American Auto supply chain so their incentive has very strict requirements around what vehicles qualify with emphasis on North American and American manufactured vehicles our incentive has no such parameters and that’s a problem given all of the Investments and we have EVS rolling off the line right here today in Canada let’s support those and make sure that we’re not undermining our own policies you know the consumer at home uh may say that you know people buy a lot of stuff from China and we’ve been conditioned to do that since sort of the globalization era of the 90s because it’s cheaper and people may say I want an electri vehicle but at a price point of $30,000 or less China can give me that North America Europe and the other big Asian makers Maybe Can’t well we should definitely not do that at the expense of environmental standards and labor standards and secondly manufacturers are rolling out EVS at an unprecedented Pace we’ve got 90 models here now in Canada available to Consumers and as these Investments ramp up we’re going to see economies of scale and with that will come a decline in prices we’re not there today but as we get towards the end of this decade prices will come down as this technology becomes more feasible for the mass Market okay but you know we we’ve talked before there’s not enough charging stations government’s not investing in charging stations now we’re looking at trade uh fights with China you have other sectors like canola Beef Pork other parts of the Canadian economy maybe not as big as the US trade but they could be caught up in protecting what is a central Canadian Focus industry yes the industry of course is is centered in Ontario and Quebec but what makes this so exciting for Canada is this EV supply chain creates opportunities across the country if we can actually get to a point where’re seeing critical minerals projects coming online mining processing this industry benefits all of camp Canada not just Ontario not only that but it is our second largest export so this is a huge industry that has a massive economic spin-off for the whole Canadian economy and again if we get the policies right I think this is a generational opportunity do you think they can have this done just as a final point like I think the US’s tariffs come in on the 1 of August right around there you think Canada can be in position to I think so I think so yeah it’ll be a very quick consultation but given the tools that they have available in particular section 53 which allows you to increase tari that can be done quite rapidly once the decision is made so I think they’ll have the ability to get this in place uh in the time required okay Brian Kingson always appreciate the time thanks for coming in thank you
The federal government took a step Monday toward making Chinese electric vehicle imports more expensive in Canada by announcing a 30-day consultation period to examine Beijing’s trade practices in the EV sector. Brian Kingston, the president and CEO of the Canadian Vehicle Manufacturers’ Association, says ‘this is a step in the right direction.’
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