Canada stated on Monday it could impose 100% import tariffs on China-made electrical autos, following within the footsteps of the U.S. and the European Union in slapping taxes over considerations associated to unfair subsidies.

Canada already imposes 6.1% tariff on EVs manufactured in China and imported into Canada, the federal government stated on Monday. The 100% tariff will come into impact from Oct. 1.

The nation may even put a 25% tariff on China-made metal and aluminum imports, efficient Oct. 15. China is the third-largest nation for metal imports into Canada, in keeping with the Canadian Metal Producers Affiliation.

Canada’s EV, metal and aluminum industries face “unfair competitors” and commerce practices from China, the federal government’s finance division stated. The U.S. and EU have made comparable allegations, citing China’s “overcapacity,” which China has known as “groundless.”

Canada stated the brand new measures search to “stage the enjoying discipline for Canadian employees” and permit Canada’s EV, metal and aluminum producers to compete domestically and globally.

These steps will probably be reviewed one 12 months from their efficient dates and could also be prolonged or supplemented with extra measures.

This comes because the Biden Administration in Could introduced a 100% tariff on Chinese language EVs. The EU additionally hit China-made EVs with greater tariffs in July, although it slashed a number of the deliberate tariffs on China-made Tesla EVs in addition to different Chinese language EV makers final week.

Vincent Chan, China strategist at Aletheia Capital, advised CNBC’s “Avenue Indicators Asia” on Tuesday that Canadian tariffs might harm China’s EV progress momentum however “is not going to completely eradicate it.”

In a press release on Monday, a spokesperson of the Chinese language Embassy in Canada stated China expresses “sturdy dissatisfaction and resolute opposition” to the transfer, including that it “violates the WTO guidelines” and “will injury commerce and financial cooperation” between China and Canada. The spokesperson added that China will take essential motion to guard its corporations.

“I wish to emphasize that the speedy growth of China’s EV trade is a results of persistent technological innovation, well-established industrial and provide chains, and full market competitors,” the spokesperson stated, including that China’s EV trade would not depend on authorities subsidies.

Chinese language EV maker BYD opened its first bus meeting plant in Canada in June 2019 and rolled out electrical buses in Toronto. Nevertheless, Chinese language manufacturers are nonetheless not a significant participant within the nation, Chinese language state media International Occasions reported in June.

Car imports from China to Canada’s largest port in Vancouver jumped 460% 12 months over 12 months to 44,356 in 2023, when Tesla began transport EVs made at its Shanghai manufacturing unit to Canada, in keeping with knowledge cited by Reuters. Tesla didn’t instantly reply to CNBC’s request for remark.

Canada may even launch a overview on different industries essential to the nation similar to batteries, semiconductors and photo voltaic merchandise.

– CNBC’s Sonia Heng contributed to this report.