After Trump’s Tariffs, Canada Will Now Implement 25% Tariffs on All U.S. EVs

The electric vehicle industry in North America is in trouble. New tariffs are shaking up the market, and it’s not just bad news for car companies—consumers will feel it, too. After U.S. President Donald Trump announced new tariffs on Canada and Mexico, Canada quickly responded with its own set of duty fees, making things even worse for the auto industry.

Over the weekend, Canada rolled out a $155 billion tariff package in response to Trump’s trade move. Part of this includes a 25% tariff on certain U.S.-made goods, including electric vehicles. Officials say this move is meant to ‘protect and defend Canada’s interests, consumers, workers, and businesses.’

The full list of affected goods will be finalized after a 21-day public comment period, but we already know that passenger vehicles, trucks, and EVs are included. Other affected items range from steel and aluminum to aerospace products, dairy, and even recreational vehicles.

Prime Minister Justin Trudeau didn’t hold back in his response. He called the tariffs ‘far-reaching’ and warned that the U.S. move will hurt American workers as well. ‘Tariffs against Canada will put your jobs at risk, potentially shutting down American auto assembly plants and other manufacturing facilities,’ he said.

Instead of bringing the two countries together, he believes these policies will drive them further apart.

The impact on the auto industry is massive. The tariffs will apply to several electric vehicles built in the U.S., including models from Tesla, Ford, General Motors, Hyundai, Kia, Rivian, Volkswagen, and Lucid.

Even though many of these vehicles already don’t qualify for U.S. federal EV tax credits, adding a 25% import duty makes them even pricier for Canadian buyers. General Motors is expected to take one of the biggest hits, since many of its high-margin trucks and SUVs rely on cross-border parts and assembly.

This isn’t just about EVs. Trump’s new tariffs affect Canada, Mexico, and China. Goods from Canada and Mexico, two of America’s biggest trade partners, will now face a 25% tariff when entering the U.S. China, already dealing with a 100% tariff on EV-related goods, will get an extra 10% duty on top of that.

Canadian officials had warned they wouldn’t accept tariffs without a fight, and now they’re following through. Chrystia Freeland, a Liberal Party leadership candidate, even suggested targeting Tesla specifically because of Elon Musk’s ties to Trump. This could mean even tougher penalties on Tesla vehicles sold in Canada.

Auto industry experts say carmakers won’t be able to absorb these costs forever. Prices will rise, and consumers will be the ones paying for it. Even though North America’s auto supply chain has long been treated as one big market, these tariffs are forcing companies to rethink how they operate.

For anyone looking to buy a car, this is bad news. If a vehicle or its parts cross the U.S.-Canada or U.S.-Mexico border, expect to see higher prices at the dealership. And even if these tariffs don’t last, they’ve already changed the way automakers plan for the future.

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