Several major Chinese automakers are preparing to start selling cars in Canada, despite strict import restrictions and the relatively small size of the local market. The main goal of these companies is not so much sales as it is preparation for a possible entry into the US market.
Currently, Canada allows the import of Chinese electric vehicles under a quota system. Up to 49,000 Chinese-made cars can be imported into the country annually. For global manufacturers, this is a relatively small volume, especially considering that several brands will be competing for it.
Nevertheless, BYD, Chery, Changan, and Lotus are showing interest in the Canadian market. Some companies are already forming dealer networks, while others are testing vehicles and preparing models for certification.
The reason for this interest is simple: the automotive markets of Canada and the US are largely similar. Consumer preferences, price segments, legislative requirements, and the structure of dealer networks are practically identical. Therefore, a successful launch in Canada will allow manufacturers to better prepare for operations in the neighboring country.
Dan Hirsch, Global Head of Automotive Practice at the consulting firm AlixPartners, believes that a subsequent entry into the American market will be practically a “flick of a switch” for manufacturers.
For now, the American market remains virtually closed to Chinese brands. High import duties, restrictions on the use of Chinese-origin software, and political barriers prevent most companies from starting full-scale sales.
A telling example was the situation with Polestar, which was forced to cease sales of some models in the US due to requirements for Chinese-origin software. At the same time, Volvo, a company belonging to the same Geely holding, received permission to continue selling similar cars.
Despite existing restrictions, Chinese manufacturers do not hide their long-term plans.
Chery International President Zhang Guibin told reporters that the company is definitely considering entering the US market.
According to industry experts, mastering the Canadian market will allow Chinese brands to adapt vehicles to North American requirements, establish service infrastructure, and gain practical experience working with local customers even before the potential opening of the American market.
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