Canada, aligning with the U.S. in its trade policies, announced on Monday a hefty 100% tariff on imported Chinese electric vehicles (EVs) and a 25% tariff on Chinese steel and aluminum. This move is aimed at protecting domestic industries and addressing what Prime Minister Justin Trudeau referred to as China's "intentional, state-directed policy of over-capacity."

The tariffs will come into effect on October 1st for EVs and October 15th for steel and aluminum. It's worth noting that while Trudeau emphasized the need to protect Canadian interests and align with other economies in response to China's trade practices, he didn't elaborate on how these tariffs might affect companies like Tesla, which currently exports EVs to Canada from its Shanghai factory.

The Chinese embassy in Ottawa has yet to comment on the tariffs, but experts speculate that Tesla might need to adjust its logistics and potentially export EVs to Canada from its U.S. production base. This could lead to increased costs for Tesla and a potential impact on its profitability.

Canada's decision comes on the heels of similar moves by the U.S. and the European Union, who have also imposed tariffs on Chinese EV imports. These actions reflect a growing concern among Western nations about China's dominance in the EV market and its potential impact on domestic industries.

While the tariffs may disrupt global supply chains and impact trade relations between Canada and China, they also demonstrate Canada's commitment to protecting its domestic manufacturers and fostering a level playing field in the global market. The Canadian government is also exploring further punitive measures on other Chinese goods, including chips and solar cells, signaling its resolve to address trade imbalances.

Canada is actively positioning itself as a key player in the global EV supply chain, having secured billions of dollars in deals with European automakers. Domestic industry players have welcomed the new tariffs, seeing them as a necessary step to defend the Canadian market against unfair trade practices.

The implementation of the U.S. tariffs has been delayed until September, and there's a possibility that planned duties might be softened. However, Canada's move underscores the growing tension in global trade relations, particularly concerning China's economic policies.