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Automotive

China suspends tariff hikes on $126B of US cars, auto parts

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BEIJING — China announced a 90-day suspension on Friday of tariff hikes on $126 billion of U.S. cars, trucks and auto parts following its cease-fire in a trade battle with Washington that threatens global economic growth.

The suspension is China’s first step in response to President Donald Trump’s Dec. 1 agreement to suspend U.S. tariff hikes for a similar 90-day period while the two sides negotiate over American complaints about Beijing’s technology policy and trade surplus.

China has indicated it plans to move ahead with the talks despite strains over the arrest of a Chinese technology executive in Canada to face possible U.S. charges related to a violation of trade sanctions on Iran.

Beijing will suspend a 25 per cent import charge on $66 billion of cars and trucks and a 5 per cent charge on $60 billion of auto parts, effective Jan. 1, the Finance Ministry announced.

The announcement helped give substance to Trump’s agreement with his Chinese counterpart, Xi Jinping, after prolonged uncertainty caused jittery global financial markets to swing wildly.

The Chinese penalties were imposed in response to Trump’s decision to slap 25 per cent tariffs on $50 billion of Chinese goods and a 10 per cent charge on another $200 billion. The second tariff was due to rise Jan. 1 until Trump agreed to the postponement.

The United States and other trading partners complain that Beijing steals or pressures companies to hand over technology in violation of its market-opening obligations. American officials also worry Chinese industry plans that call for state-led creation of global champions in robotics and other fields threaten U.S. industrial leadership.

A spokesman for China’s Commerce Ministry, Gao Feng, said Thursday the two sides were in “close contact” but gave no timetable for possible face-to-face negotiations.

Economists say 90 days probably is too little time to resolve conflicts that have bedeviled U.S.-Chinese relations for years. They say Beijing’s goal probably will be to show it is making progress so Trump extends his deadline.

Beijing officials expressed confidence China could withstand U.S. pressure but the fight battered consumer confidence and threatened export industries that support millions of jobs.

Friday’s announcement “shows the Chinese government is willing to solve trade disputes through consultation based on equality,” said Song Lifang, an economist at Renmin University in Beijing.

The tariff cut lowers the charge for U.S.-made cars and trucks to 15 per cent, the same level as imports from other countries.

“If the United States cuts or remove tariffs on Chinese goods, China will surely follow up with further relevant measures,” Song said.

___

AP researcher Yu Bing in Beijing contributed to this report.

Joe McDonald, The Associated Press

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Trudeau must repeal the EV mandate

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By Dan McTeague

Last Monday, Transport Canada released a bombshell statement, announcing that the Trudeau government’s program granting a $5,000 rebate to Canadians purchasing an Electric Vehicle (EV) had run out of money and would be discontinued, “effective immediately.” This followed a prior announcement from the government of Quebec that they would be suspending their own subsidy, which had amounted to $7,000 per EV purchased.

This is, of course, a game changer for an industry which the Trudeau government (as well as the Ford government in Ontario) has invested billions of taxpayer dollars in. That’s because, no matter the country, the EV industry is utterly dependent upon a system of carrots and sticks from the government, in the form of subsidies and mandates.

EVs have remained notably more expensive than traditional Internal Combustion Engine (ICE) vehicles, even with those government incentive programs. Without them the purchase of EVs becomes impossible for all but the wealthiest Canadians.

Which is fine. Let the rich people have their toys, if they want them. Though if they justify the expense by saying that they’re saving the planet by it, I may be tempted to deflate them a bit by pointing out that EVs are in no way appreciably better for the environment than ICE vehicles, how all the lithium, nickel, cobalt, manganese, aluminum, copper, etc, contained in just one single EV battery requires displacing about 500,000 lbs of earth. Mining these materials often takes place in poorer countries with substandard environmental regulations.

Moreover, the weight of those batteries means that EVs burn through tires more quickly than gas-and-diesel driven vehicles, and wear down roads faster as well, which among other issues leads to an increase in particulate matter in the air, what in the old days we referred to as “pollution.”

That is a potential issue, but one that is mitigated by the fact that EVs make up a small minority of cars on the road. Regular people have proved unwilling to drive them, and that will be even more true now that the consumer subsidies have disappeared.

Of course, it will be an issue if the Trudeau Liberals get their way. You see, Electric Vehicles are one of the main arenas in their ongoing battle with reality. And so even with the end of their consumer subsidies, they remain committed to their mandates requiring every new vehicle purchased in Canada to be electric by 2035, now just a decade away!

They’ve done away with the carrots, and they’re hoping to keep this plan moving with sticks alone.

This is, in a word, madness.

As I’ve said before, the Electric Vehicle mandate is a terrible policy, and one which should be repealed immediately. Canada is about the worst place to attempt this particular experiment with social engineering. It is famously cold, and EVs are famously bad in the cold, charging much slower in frigid temperatures and struggling to hold a charge. Which itself is a major issue, because our country is also enormous and spread out, meaning that most Canadians have to do a great deal of driving to get from “Point A” to “Point B.”

Canada is sorely lacking in the infrastructure which would be required to keep EVs on the road. We currently have less than 30,000 public charging stations nationwide, which is more than 400,000 short of Natural Resources Canada’s projection of what we will need to support the mandated total EV transition.

Our electrical grid is already stressed, without the addition of tens of millions of battery powered vehicles being plugged in every night over a very short time. And of course, irony of ironies, this transition is supposed to take place while our activist government is pushing us on to less reliable energy sources, like wind and solar!

Plus, as I’ve pointed out before, the economic case for EVs, such as it was, has been completely upended by the recent U.S. election. Donald Trump’s victory means that our neighbors to the south are in no immediate danger of being forced to ditch gas-and-diesel driven cars. Consequently, the pitch by the Trudeau and Ford governments that Canada was putting itself at the center of an evolving auto market has fallen flat. In reality, they’ve shackled us to a corpse.

So on behalf of my fellow Canadians I say, “Thank you,” to the government for no longer burning our tax dollars on this particular subsidy. But that isn’t even half the battle. It must be followed through with an even bigger next step.

They must repeal the EV mandate.

Dan McTeague is President of Canadians for Affordable Energy.

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Liberals Have Cut Canada’s Electric Vehicle Subsidies, Now It’s Time to Kill the 2035 Mandate

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By Dan McTeague

Former Liberal MP Dan McTeague calls on Mark Carney and all other leadership candidates to kill Trudeau’s electric car mandate.

President of Canadians for Affordable Energy (CAE) and former Liberal MP Dan McTeague says, “It’s good that the Trudeau government are ending their taxpayer funded electric vehicle subsidy, but it’s time to take the most important step of all and kill the government’s mandate that all vehicles bought in Canada be battery powered by 2035.”

As of January 10th, Transport Canada announced that it “paused” its financial incentive to purchase electric vehicles which had provided up to $5,000 of taxpayers money to anyone who purchases an electric vehicle. Quebec ended its $7,000 subsidy last February. However, the government policy requiring that every car sold in Canada after 2035 be electric remains in force.

“Even with these giveaways in place, it was a stretch for hard working Canadians to afford an EV,” said McTeague. “We at CAE are happy for Canadian taxpayers that the program is coming to an end. But this move must be followed up by abolishing the mandates on unaffordable electric vehicles once and for all.”

“My hope is that each and every Liberal Leadership candidate stands up and acknowledges that mandating that all new cars in Canada be electric by 2035 is wrong and that that policy needs to be scrapped,” added McTeague.

Dan McTeague served in Parliament as a Liberal MP for 18 years, and is now Executive Director of Canadians for Affordable Energy. CAE counts on it’s 60,000 supporters nationwide, you can find more information here: https://www.affordableenergy.ca/

For more information contact: 

Dan McTeague
647-220-0114
[email protected]

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