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Tariff Battle Has Reduced The Popularity Of America Cars In Canada
Canadians are more likely to choose cars built in countries other than the US. The share of cars from US factories in total imports has even fallen to a new low, according to figures from Statistics Canada. This is the result of import duties between neighbouring countries.
Only 36 percent of passenger cars imported into Canada in the first ten months of 2025 were manufactured in US factories. This is well below the ten-year average of 49 percent.
The tariff war has caused the stock to fall sharply. Canada imposed import duties on cars from the United States in response to Donald Trump’s tariffs. Tesla, for example, is avoiding these tariffs by shipping cars from its German factories to Canada.
The US market share in Canadian auto imports had been declining for some time. Increased imports were taking over that share from Mexico, South Korea, and Japan.
The share of cars produced in China fell to 1.3 percent in the first ten months of last year. This was due to Canada’s 100 percent import tariff on Chinese electric cars, which it imposed in 2024. On Friday, Canadian Prime Minister Mark Carney announced that Canada will import 49,000 electric cars from China at a reduced tariff of 6.1 percent. Carney is in China this week to try to calm the tariff war between the countries.
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