Welcome to the Daily 5 report for Friday, Jan. 16.
Mark Carney's first foreign trade deal as Canadian prime minister has major implications for his country's auto industry — and perhaps the U.S. market as well.
News broke this morning that Canada has reached a "preliminary but landmark" agreement that will allow 49,000 Chinese electric vehicles into the Canadian market each year at a 6.1 percent tariff. Carney said that will make some EVs more affordable for Canadians and that this would be just about 3 percent of the Canadian domestic market.
The EV deal comes as Canada, the U.S. and Mexico are preparing to renegotiate — or perhaps walk away from — the United States-Mexico-Canada Agreement on free trade.
Automotive News Canada reached out to analysts and executives for their reactions. The news was met with disappointment and skepticism.
Said Canadian Vehicle Manufacturers' Association CEO Brian Kingston, who represents the interests of the Detroit 3 in Canada: "There are significant risks associated with allowing Chinese EVs into the market, including what it means for our much more important relationship with the United States."
This raises the question: Chinese automakers have already established a manufacturing and sales footprint in Latin America, and now their government has made a deal to start selling in Canada. Is it inevitable that the U.S. will be next?
President Donald Trump, during a speech this week in Detroit before the region's auto show, reiterated his openness to letting Chinese automakers open factories in the U.S. And longtime readers of Automotive News remember entrepreneurial efforts to import and sell vehicles from Chinese brands such as Chery, Geely, Changfeng, Zotye and Great Wall in the U.S. — but those efforts stalled out.
Whatever happens, Automotive News will keep you up to date on the latest developments on Chinese automakers' global ambitions.
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— Omari Gardner, managing editor, operations
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