by Tesla is the first to start selling Chinese electric vehicles in Canada
As expected, Tesla has become the first electric vehicle manufacturer to start selling models made in China in the Canadian market. This became possible after the two countries signed a significant trade agreement earlier this year. This is great news for Canadian buyers, as they now have access to Tesla models at prices significantly lower than their American counterparts. In fact, it’s the cheapest Tesla EV ever sold in North America.
New trade agreement and tariff reductions
Thanks to the new trade agreement, up to 49,000 EVs manufactured in China can be imported into Canada at a reduced tariff rate of 6.1 percent. This is significantly lower compared to the 106.1 percent tariff that was in effect in 2024. Canadian officials began issuing permits for the first 24,500 vehicles back in March, and Tesla was quick to take advantage of this opportunity.
Prices and specifications of the Chinese Model 3
By importing cars from China, Tesla has reintroduced the base Model 3 Premium RWD in Canada. Its price starts at 39,490 Canadian dollars before delivery, which at the current exchange rate is about 29,007 US dollars. This is significantly cheaper than the most affordable Model 3 in the US, the standard RWD version, which costs from $36,990 USD excluding taxes and delivery fees. The Shanghai-spec Model 3 has a claimed range of 463 km and can accelerate from 0 to 100 km/h in 5.2 seconds.
Before the agreement came into effect, the most affordable Model 3 in Canada was the Long Range AWD version, supplied from Fremont, California. Its starting price was 79,990 Canadian dollars ($58,700 USD). Although this isn’t an entirely fair comparison, Tesla effectively halved the entry cost to the Canadian market overnight.
Price reduction for Performance
Canadian buyers can also order the Model 3 Performance version starting at 74,990 Canadian dollars ($55,050 USD). This is 17 percent less than the previous price of 89,990 Canadian dollars ($66,070 USD), equivalent to $55,260 USD. It has not yet been confirmed where Tesla will source the Model 3 Performance from, although some reports suggest Fremont likely remains the production site.
Nuances and outlook
The only downside of Tesla importing some Model 3s from China is that these models do not qualify for Canada’s Electric Vehicle Availability Program (EVAP), which provides a $5,000 rebate, as reported by Drive Tesla.
It is not yet known how many of the initial 24,500 permits Tesla will receive, although Canadian officials have confirmed they are issued on a first-come, first-served basis. If competitors such as Volvo and Polestar do not rush to deliver their own Chinese EVs across the Pacific, Tesla appears poised to grab the lion’s share of the market.
This situation demonstrates how a change in trade policy can drastically affect the automotive market. The reduction of tariffs on Chinese EVs has not only made Tesla significantly more affordable for Canadians but has also set a precedent for other manufacturers. It is worth noting that while the price of the car has become much more attractive, the lack of a government subsidy may somewhat offset this advantage for some buyers. Furthermore, this could lead to increased market competition, forcing other manufacturers to also seek ways to lower prices or improve their offerings for Canadian consumers.
