China’s Geely will begin deliveries of Lotus electric vehicles in Canada in July, marking the first entry of Chinese-owned and Chinese-manufactured EVs into the Canadian market under a new bilateral trade framework negotiated by Prime Minister Mark Carney and Chinese President Xi Jinping. The first shipment will arrive in Montreal, where Lotus plans to hold a launch ceremony, according to Chinese Ambassador to Canada Wang Di.
The deliveries represent the first commercial implementation of Canada’s new quota system, which allows up to 49,000 Chinese-made EVs to enter the country in 2026 at an average tariff rate of about 6%, replacing the 100% tariff imposed in 2024.
The agreement is part of Canada’s broader strategy to diversify trade beyond the United States while maintaining regulatory oversight of foreign investment in strategic industries. Government officials said the quota will increase by 6.5% annually, reaching approximately 67,000 vehicles by 2031.
“Geely EVs will be arriving in Canada next month, and they will be holding a ceremony when the cars are delivered in Montreal,” Wang told Reuters. Lotus Cars did not respond to requests for comment, while Canada’s Global Affairs department declined to comment on specific shipments due to commercial confidentiality.
The arrival of Lotus vehicles is expected to be followed by additional Chinese brands. Wang said Chery Automobile and BYD are working with Canadian government agencies to complete regulatory procedures before beginning commercial sales. Canadian officials have previously confirmed that some vehicles from both companies have already entered the country for testing under Canadian climate and road conditions.
“I hope in autumn this year, other Chinese EV brands will complete the procedures and enter the Canadian market,” Wang said through an interpreter.
BYD Executive Vice President Stella Li recently told Reuters the company is likely to begin Canadian sales in 2027. Tesla has already imported vehicles manufactured at its Shanghai facility into Canada, underscoring the role Chinese production already plays in supplying the Canadian EV market through global supply chains.
Industry Minister Mélanie Joly said discussions with executives from BYD, Chery Automobile, Geely Holding Group, and Shanghai Launch Automotive Technology have focused not only on imports but also on potential industrial investment opportunities in Canada. According to Joly, Chinese automakers have expressed interest in establishing joint ventures to manufacture vehicles locally after assessing market demand.
“The only way for Chinese automakers to obtain access to Canada is through the quota import system or through a joint venture with a Canadian company that complies with the rules I have established,” Joly said.
She added that any investment must comply with Canada’s Investment Canada Act, which allows the government to impose conditions on foreign participation in strategic sectors. Those conditions include Canadian ownership requirements, compliance with labor standards, integration into domestic supply chains, and secure vehicle software systems designed to protect consumer data.
The government also rejected proposals focused solely on assembling imported vehicle kits. Officials said Canada intends to attract investments that generate domestic manufacturing activity, engineering capabilities, and supplier development rather than limited assembly operations.
The framework is also influencing discussions involving Stellantis NV and Zhejiang Leapmotor Technology. Federal officials are evaluating whether an idle Stellantis assembly plant in Brampton, Ontario, could be used to assemble Chinese-designed electric vehicles under a joint venture structure that complies with Canadian investment rules.
The EV import framework forms part of a broader trade agreement reached earlier this year between Canada and China. In exchange for reducing tariffs on Chinese-made electric vehicles, China lowered tariffs on selected Canadian agricultural exports, including canola meal, peas, and seafood products. However, China maintained tariffs of 100% on canola oil and 25% on pork, while temporary tariff relief for several agricultural products is scheduled to expire at the end of 2026.
Wang declined to indicate whether Beijing would extend those tariff suspensions or reduce remaining duties. “As long as the two countries uphold the principles of mutual respect, equality, and reciprocity, there will be nothing we cannot resolve,” he said.
The agreement also supports Canada’s objective of expanding exports to China. During his January visit, Carney announced a target of increasing Canadian exports to China by 50% by 2030. Chinese Foreign Minister Wang Yi later suggested bilateral exports could double instead.
“Canadian exports have already risen 27.5% in the five months since Carney’s visit,” Wang said. “As we continue to move forward, our economic and trade cooperation continues to unlock the potential of our economies and leverage our complementarities. I think we may even go beyond 100%—perhaps even reach 200%.”
He also identified energy exports as an area for expansion, stating that Canada could supply nearly 22 million metric tons of crude oil annually to China, compared with 15.5 million metric tons last year. Wang added that he sees “great potential” for Canadian liquefied natural gas exports to China but did not provide further details.
Agricultural trade also remains a focus. Wang noted that Canada currently supplies only about 2% of China’s agricultural imports, despite being a major exporter of canola, peas, and beef.
“As long as we stay on the right track, at the right pace, and in the right direction, there will be significant potential to expand our trade,” he said.
The policy has generated debate in North America. US officials and lawmakers have criticized Canada’s decision to reopen access for Chinese EVs, arguing that subsidized vehicles should not receive preferential treatment within North American supply chains.