• Canada's new policy allows thousands of low-cost Chinese electric vehicles to enter its market under reduced tariffs.
  • General Motors (GM) CEO Mary Barra warns the move threatens North American jobs, security, and the domestic auto industry, calling it a "slippery slope."
  • The decision contrasts with U.S. high tariffs on Chinese EVs, highlighting tensions in balancing affordable green tech access with protecting local manufacturing.

Canada has announced a deal permitting thousands of low-cost Chinese electric vehicles to enter its market under reduced tariffs, according to people familiar with the matter. The move has sparked immediate backlash from General Motors CEO Mary Barra, who argues it poses significant risks to North American jobs and security.

"This is a slippery slope that could undermine our domestic auto industry and the hundreds of thousands of workers it supports," Barra said in a statement, echoing concerns reported in recent financial coverage. She emphasized that without robust trade barriers, the influx of subsidized Chinese EVs could erode local production and supply chain resilience. Efforts to reach Canadian trade officials for comment were unsuccessful as of Thursday afternoon.

The policy shift comes as legacy automakers like GM accelerate their own EV transitions, with the company committing $35 billion by 2035 for electrification and autonomy under Barra's leadership. In contrast, the U.S. maintains high tariffs—up to 100% in recent years—on Chinese EVs to protect domestic interests, a stance Barra has publicly supported. This divergence between North American neighbors could create regulatory arbitrage, allowing Chinese manufacturers to use Canada as a backdoor into broader regional markets.

Industry analysts note that Chinese EV imports, buoyed by state subsidies and economies of scale, often undercut North American pricing by 20-30%, pressuring local plants and potentially forcing layoffs. "You're looking at a direct hit to competitiveness in auto hubs like Ontario and Michigan," said one source close to the negotiations, who requested anonymity due to the sensitivity of ongoing talks. Market data shows EV adoption rates in Canada have lagged behind the U.S., partly due to higher costs, which this policy aims to address.

Barra, who became GM's first female CEO in 2014 after rising through engineering and product development roles, has positioned the company as a defender of local manufacturing amid global shifts. Her criticism aligns with past U.S. tensions, such as threats to cut GM subsidies over plant closures in 2018, and mirrors recent EU actions imposing duties up to 45% on Chinese EVs. However, some consumer advocates argue that cheaper EVs could accelerate the green transition, offering more affordable options in a market where prices remain a barrier for many buyers.

Short-term, the deal may intensify competition, risking job losses at GM and other automakers' Canadian facilities. Long-term, experts predict it could force North American manufacturers to slash prices or innovate faster, though Barra warns of enduring security vulnerabilities if foreign dependency grows. GM's push for an all-EV fleet by 2035 now faces added pressure from this external challenge, even as it invests in battery plants and autonomous tech like its Cruise acquisition.

Correction: An earlier version misstated the timeline for GM's electrification investment; it is $35 billion by 2035, not 2030.