Overview
- Prime Minister Mark Carney said a hot‑microphone exchange at the G7 showed President Donald Trump told him he “likes” Canada’s 49,000‑vehicle quota for China‑built electric cars, a cap Ottawa calls a hard limit.
- The quota, in effect since March 1, 2026, allows imports up to 49,000 vehicles a year under a 6.1% most‑favoured‑nation tariff and is split into two 24,500 six‑month windows with shipment‑specific permits being issued.
- Ottawa has barred quota imports from the federal $5,000 EV rebate and says the market opening is conditional on Chinese automakers forming joint ventures or building substantial Canadian production rather than low‑value kit assembly.
- Permits are being processed and China‑built deliveries are expected to scale through the second half of 2026, with Tesla already resuming shipments of China‑made Model 3 sedans to Canada.
- The policy has drawn sharp criticism from North American automakers and some U.S. officials and has become a live issue in the upcoming USMCA/CUSMA review, raising the risk of trade tension if negotiators do not reconcile rules on auto supply chains.