Canada Slaps Tariffs on US Goods, Including Teslas, in Response to Trump's Threats

OTTAWA, Ontario - In a bold move, Canada has proposed imposing 100% tariffs on select American goods, including those from Tesla, in response to President Donald Trump's threatened tariffs on Canadian and Mexican imports. The strategy is aimed at economic retaliation and targets those who have backed Trump, with Tesla CEO Elon Musk being specifically mentioned.

According to an interview with The Canadian Press, Foreign Minister Chrystia Freeland outlined the plan, stating that Canada needs to be "very targeted, very surgical, very precise" in its response. She singled out Tesla, highlighting Mr. Musk's financial and operational backing of Trump as a notable example of those who will face the tariffs. This decision is likely to have a significant impact on Tesla's electric vehicles sold in Canada, primarily manufactured in the US and China.

The stakes are high, with Canada's EV adoption rate surpassing that of the US by nearly 9 percentage points in the third quarter of 2024. Quebec's aggressive incentives have further fueled this growth, making Tesla's dominance even more vulnerable. Imposing tariffs on US goods will inevitably hike prices for Canadians, potentially steering buyers toward other automakers.

Freeland, who stepped down as Finance Minister last year due to disagreements over handling Trump's economic threats, is now using this issue to define her leadership campaign. She has acknowledged the uncertainty surrounding Trump's administration and aims to capitalize on it. "There are lots of reports about there being internal debates in the US," she said. "Let's use that to our advantage. And let's put some cards on the table and be very clear that if they hit us, we will hit them back."

This bold move by Canada sets a new precedent for economic retaliation, putting businesses tied to Trump's political machinery directly in the crosshairs. As tensions between the two countries continue to escalate, it remains to be seen how this strategy plays out and its impact on the global automotive market.