Canada wants to follow the U.S. in banning imports of connected vehicle software and hardware from China and Russia
In a recent interview, Canadian Deputy Prime Minister and Finance Minister Chrystia Freeland revealed that the government is “absolutely considering” following the U.S. in its move to ban certain automotive software and hardware sourced from China and Russia. This comes after the U.S. Department of Commerce’s Bureau of Industry and Security announced plans on September 23 to prohibit the sale or import of connected vehicle software and hardware linked to these nations, with the ban set to take effect in 2027.
Freeland highlighted the Canadian government’s significant concerns regarding China’s deliberate overproduction and the security threats it poses. She reiterated that there is a clear governmental position on ensuring safety and fairness in trade practices.
Adding to the context, Prime Minister Justin Trudeau has already implemented stiff tariffs on imports from China, including a 100% tariff on Chinese electric vehicles and a 25% tariff on aluminum and steel products. Last month, Freeland began consultations about imposing high tariffs on additional Chinese items, such as battery components and critical minerals, citing China’s unfair trade practices and excessive state subsidies that disrupt global markets.
However, the viability of these tariffs is under scrutiny, as China has announced its intention to contest Canada’s tariffs at the World Trade Organization (WTO) and is seeking consultations.
Sources within the government, who wish to remain anonymous, suggest that banning Chinese automotive software could be part of a long-term strategy to prevent Chinese electric vehicles from entering the Canadian market. Nonetheless, issues surrounding software security and privacy are also vital considerations in this decision-making process.
One official noted that if Canada moves to ban Chinese software on security grounds, it may necessitate new legislation. This could become more complicated with a potential election looming next year, especially amid Prime Minister Trudeau’s low approval ratings, which could bring about a shift in government.
Currently, the presence of electric vehicles produced in China in the Canadian market is minimal, primarily limited to those made at Tesla’s Shanghai facility.
