Mon Feb 03 11:40:00 UTC 2025: ## Canada Threatens 100% Tariffs on Tesla in Retaliation for US Trade Actions

**OTTAWA** – Amid escalating trade tensions between the US and Canada, Liberal Party leadership contender Chrystia Freeland has proposed a dramatic countermeasure to President Trump’s threatened tariffs: a 100% tariff on select American goods, notably including Tesla vehicles.

Freeland, Canada’s former finance minister, justified the move as a targeted response to Trump’s actions, highlighting Tesla CEO Elon Musk’s support for the former president. “We need to look at who is supporting Trump and make them pay a price,” she stated in an interview with The Canadian Press.

The proposed tariffs would significantly increase the price of Tesla vehicles in Canada, potentially impacting the company’s dominant position in the Canadian EV market. Tesla’s Model Y and Model 3 currently lead sales, but higher prices could drive consumers towards competing brands.

This aggressive strategy reflects Canada’s growing frustration with the uncertainty surrounding Trump’s trade policies. Freeland, who previously resigned over disagreements on handling Trump’s economic threats, is framing this as a key element of her leadership bid. She emphasized the need for a firm response, stating, “If they hit us, we will hit them back.”

The move carries significant weight given Canada’s rapidly expanding EV market, which is significantly outpacing that of the US. With nearly 17% of new car sales in Q3 2024 being fully electric, compared to 8% in the US, Canada’s vulnerability to trade disruptions is amplified. Quebec’s strong EV incentives further highlight Tesla’s prominent, and now potentially precarious, position in the Canadian market.

The situation underscores a shift in Canada’s response to US trade actions, moving beyond diplomatic efforts to directly target businesses linked to Trump’s political network. The outcome of this escalating trade war remains uncertain, but Tesla’s inclusion in Canada’s proposed counter-tariffs marks a significant escalation in the conflict.

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