Canada replaced a 100% tariff on Chinese-made electric vehicles. The new tariff is 6.1%. This applies to an annual quota of 49,000 units. Tesla is expected to be a primary beneficiary of this decision.
The move allows Tesla to resume exporting vehicles from its Shanghai Gigafactory to the Canadian market. Shanghai is Tesla's largest and most cost-efficient plant.
Tesla equipped the Shanghai plant in 2023 to build a Canada-specific version of the Model Y. The automaker was forced to halt shipments when the steep tariff was imposed in 2024. Tesla boasts an established network of 39 stores in Canada. This positions Tesla to quickly capitalize on the renewed trade channel, unlike Chinese domestic brands that lack a sales presence in the country.