The Standing Committee on International Trade in Canada's House of Commons is carrying out a study in preparation for the upcoming review of the USMCA (referred to as CUSMA in Canada). At its first meeting with expert witnesses, a number of issues related to trade in Chinese EVs were raised.

The Committee's study will consist of multiple meetings. At the first one, the issues related to China trade centered on EV imports into North America.

First, MP Richard Cannings of the New Democratic Party asked Angelo DiCaro of the labor union Unifor about how North American EV production can deal with the threat from China: "China has been leading the world in all sorts of EV manufacturing, with batteries, etc., and is now producing vast quantities of inexpensive EV vehicles. I'm wondering what concerns you have there and what we have to look out for when we're trying to renegotiate CUSMA to make sure that North America as a whole can withstand that competition."

DiCaro offered the following response, focusing on a number of Chinese production practices:

Yes, I have very serious concerns, and this goes beyond any conversations about competitiveness on cost. This is about a country and an industrial model that is built on baked-in subsidies, not just unfair labour but forced labour, things that we wouldn't tolerate in Canada and are certainly against the spirit of what we're trying to build in the CUSMA as a high-road trade agreement. China is developing this EV space ... through methods that I think would not be tolerated in other nations. They are intentionally oversupplying—not unlike what's happened in aluminum and steel, as others will tell you— producing an excessive capacity for the express purpose of flooding the global market with cheap exports. Right now, based on some of the public reports we've seen— things are a bit difficult stats-wise to locate in China—there's an expectation that, put simply, the level of production of EVs in China, the overcapacity alone is larger than the entire North American auto market for sales. This is not something people should be taking lightly, and we're going to have to deal with it.

MP Kyle Seeback of the Conservative Party then brought up the risk of Canada being a "backdoor" for imports into North America from China: "The United States is looking at it. They've just put in the 301 tariffs on a whole bunch of things. Is Canada at risk again? Our anti-circumvention system, which the current government brought in, just isn't working efficiently or quickly enough because there have been no cases."

Catherine Cobden of the Canadian Steel Producers Association responded by stating that "we need to consider tariffs on China ourselves. We just talked about EVs. I want to say that the number of EVs from China, based on Canadian import stats, is very scary as well. It's not my place to make policy for the government, but if I were in charge, I'd be looking at the full supply chain, not just steel."

Brian Kingston of the Canadian Vehicle Manufacturers' Association also weighed in on Chinese EV imports:

Before I conclude, I want to take a moment to address the recent increase in U.S. tariffs on Chinese EVs and the implications for Canada and CUSMA. Canada cannot be out of step with its largest trading partner and strongest ally on China as we approach the CUSMA review. There is simply too much at stake for the automotive industry and the broader Canadian economy if Washington perceives Canada as misaligned. We should be prepared to strengthen our trade defences in response to a surge in dumped Chinese EVs into the market and, at a minimum, we must work closely with our American partners to address potential security threats posed by Chinese-manufactured connected vehicles. Given the highly integrated nature of the North American highway network, the security of Canadian roads is the security of American roads.

More generally on the issue of coordinating trade policy with the U.S., in response to a question from Conservative MP Matt Jeneroux, Kingston said "we have to make sure that the Americans know that we stand shoulder to shoulder with them on this approach to China. That is priority number one, particularly as we get towards this review." He also stated: "If they view us as a weak link on China, we will have a problem. That needs to be communicated clearly."

There are a number of steps that can be taken, Kingston added, including a tariff or an anti-dumping or a subsidy investigation. In addition, he noted, "the White House has launched a security investigation into connected vehicles from China." On this point, he said that "[i]f it's a security threat to the Americans, I would think it's a security threat to Canada." Those are "the types of things that we should be investigating and making sure the Americans know we are with them."