Chinese automaker Geely Auto Group is preparing to enter the North American market following a trade agreement signed between Canadian Prime Minister Mark Carney and Chinese President Xi Jinping. The deal, finalized in Beijing in January, reduces Canadian tariffs on Chinese electric vehicle (EV) imports from 100% to 6%.
The entry into Canada comes as Chinese EV manufacturers expand their global presence. In Australia, Chinese vehicles increased from 0% to more than 30% market share over the last decade. In Europe, the market share for Chinese EVs rose from 9% to approximately 14% over the past year. The U.S. government currently maintains prohibitive tariffs and bans on Chinese vehicles, citing national security and the protection of the domestic auto industry.
Under the new trade terms, 49,000 Chinese EVs are scheduled for sale in Canada during the first year of the agreement. Zeekr, Geely’s luxury brand, plans to export its 9X plug-in hybrid model to Europe and the Middle East starting this month. Zhao Chunlin, Zeekr’s vice president of manufacturing and a former General Motors employee, stated that the company views future U.S. involvement through collaborations and joint ventures rather than direct competition.
The day-to-day impact will be felt by North American manufacturers who must now compete with lower-priced imports just across the border. While U.S. residents cannot currently purchase these vehicles due to federal trade barriers, the presence of a manufacturing and sales hub in Canada sets a precedent for Chinese firms to gain a foothold in the North American supply chain. Michael Dunne of Dunne Insights noted that U.S. companies may need to leverage advanced software, chips, and autonomous driving technology to sustain their domestic industry against these lower-cost alternatives.
What happens next depends on the performance of these initial imports and potential policy responses from the U.S. government. While Geely has expressed interest in one day selling or manufacturing in the U.S., no specific dates for such a move have been reported. The first wave of 49,000 vehicles is expected to enter the Canadian market within the first year of the deal's implementation, while Zeekr's expansion into Europe and the Middle East begins this month.