Chinese automakers aren’t wasting any time getting into Canada. Just two weeks after Prime Minister Mark Carney announced in January that Canada would allow limited EV imports from China, Chery, the country’s biggest auto exporter, was already sitting down with Canadian car dealers, according to a new Reuters report.
BYD, now the world’s largest EV maker, is moving fast too. An advisory firm scouting dealership locations for BYD told Reuters the company is planning to open six dealerships in Canada. BYD has also already started the compliance process to import two passenger cars into the country, according to regulatory records. Earlier this month BYD posted job openings for numerous positions in Toronto.
Lotus, the luxury brand owned by Chinese auto giant Geely, is jumping in as well, with plans to open half a dozen Canadian dealerships this year. Lotus CEO Qingfeng told Reuters that’s mainly to sell a few hundred cars, so it’s a small play for now. Meanwhile, state-owned automaker Changan has a team actively working on its own Canada launch, according to design chief Klaus Zyciora.
Here’s the thing though, none of this makes much financial sense on its own. Canada only approved imports of 49,000 cars a year at a low 6.1 per cent tariff rate, and that cap only climbs to 70,000 over five years. Split between all these companies, that’s not exactly a goldmine.
So why bother? Reuters reports that Canada gives these companies something more valuable than sales numbers, a foothold close to the US market, which most industry watchers think Chinese automakers will eventually crack despite current American policies blocking them out.
Chery International president Zhang Guibing made that ambition pretty clear, telling reporters in May at the company’s Wuhu headquarters, “We definitely have the idea of selling cars in the United States. Everyone definitely has that idea.”
BYD’s executive vice president Stella Li told Reuters at a London event that the company is still working out which models it’ll bring to Canada and expects to start sales sometime next year. She pushed back on the idea that BYD sees Canada as practice for the US, saying the company doesn’t need it. “I don’t need to practice,” Li said. “I lived in the U.S. for 15 years.”
It’s unclear if the US will ever let Chinese EVs into the country, unless they are being built in America. There’s already legislation underway that wants to ban Chinese EVs from driving across the board from Canada.
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