Dongfeng Motor is preparing to enter Canada's electric vehicle (EV) market, capitalising on a low-tariff quota negotiated by Prime Minister Mark Carney earlier this year.
The Chinese state-owned manufacturer will display EV models at a Montreal event this week and is currently pursuing certification for its vehicles with Canadian regulators.
Julie Mazorra Fernández, director of North World Industry – the firm set to distribute Dongfeng vehicles in Canada – was quoted in a Bloomberg report as saying the company anticipates launching its first two models next year.
In 2024, Carney's predecessor, Justin Trudeau, introduced a 100% tariff on Chinese-manufactured EVs, layered atop the existing 6.1% rate, which effectively excluded Chinese brands from the Canadian market and prompted Tesla to restructure its supply arrangements.
Carney struck a deal with Chinese President Xi Jinping in January to suspend the 100% surtax on as many as 49,000 Chinese-made EVs for an initial 12-month period, with China agreeing in return to lift its own tariffs on select Canadian farm exports.
Canada intends to expand the quota for Chinese vehicles under the lower tariff rate in subsequent years.
Tesla remains the sole company drawing significantly on the import allowance, using it to bring in vehicles built at its Shanghai plant.
BYD and Chery Automobile have both signalled plans to begin utilising the quota in the near term.
“We are working hard on that, and maybe next year we will be ready to introduce the first two models”, Mazorra Fernández said.
Mazorra Fernández said the firm intends to build familiarity among Canadian consumers with its products before shifting to sales.
She noted that establishing manufacturing operations within Canada could feature in Dongfeng's longer-term strategy, pointing to the company's current joint ventures with Stellantis and Nissan Motor for vehicle production in Europe and South America.
Carney has indicated the agreement with Xi could pave the way for additional Chinese joint-venture investment in Canada involving “trusted partners”.
Industry Minister Melanie Joly travelled to China last month, where she said Chinese automakers are evaluating the Canadian market for possible manufacturing tie-ups.
