Industry and Technology

This meeting of the House of Commons Standing Committee on Industry and Technology (INDU) studied the federal government's electric vehicle (EV) policies and the impact of importing Chinese EVs. Appearing as witnesses were Margaret McCuaig-Johnston, a Senior Fellow at the University of Ottawa; Julian Karaguesian, a Visiting Lecturer in Economics at McGill University; Benjamin Taylor, CEO of Beachman Motor Company Ltd.; and Nicole Vlanich, Executive Director of the Canadian Association of Moldmakers.

Margaret McCuaig-Johnston raised four major concerns about Chinese EVs: the stress on Canada's auto sector from cheap imports, the use of aluminum from Uyghur forced labour in Chinese EVs, the national security risk of Baidu software that sends data to China, and the pricing strategy that undercuts local competition. She recommended stripping out Baidu software and replacing it with BlackBerry QNX, requiring transparency in supply chains to prove no forced labour, and ensuring any joint ventures are more than 60% western-owned with Canadian management and technology transfer. She disagreed with the government's approach, noting that the customs notice for Chinese EVs does not mention forced labour and that promised legislation and an agency on forced labour appear stalled.

Julian Karaguesian argued that Canada faces its biggest economic challenge since the 1930s due to U.S. tariffs and that opening the economy to Chinese EVs is a step toward diversifying trade and reducing dependency on the United States. He stated that the 49,000 Chinese EVs represent less than 3% of the Canadian market and that Canada has a natural trading relationship with China as a resource and energy superpower. He recommended pursuing diversification through trade with the global south and using industrial policy to protect skilled workers, potentially shifting manufacturing into defence industries. He disagreed with critics who fear Chinese espionage, noting that smart devices already pose similar risks and that the deal is a necessary quid pro quo for market access.

Benjamin Taylor, representing a Canadian EV start-up, described his company's model of designing parts in Canada, manufacturing them in China due to prohibitive domestic costs, and assembling them in Toronto for export. He stated that a simple frame costs over 20 times more to produce in Canada than in China, including shipping and tariffs, and that Canada's strengths lie in branding, quality and consumer trust. He recommended investing in new, pure-play EV brands and supporting domestic assembly to allow Canadian companies to thrive during the global EV transition, and he noted his company is working on a Canadian-built electric car using Chinese components.

Nicole Vlanich explained that mould-making is foundational to manufacturing, with 70% to 80% of the sector supporting automotive production, and that where vehicles are built determines whether Canadian industry participates. She stated that the proposed volume of Chinese EVs represents about one-third of projected EV sales in Canada in 2026, which could shape sourcing decisions and supply chain participation, and that EV programs have already been delayed or cancelled after companies invested in tooling. She recommended ensuring that Canada's EV strategy supports domestic production, workforce development and environmental responsibility, including a comprehensive end-of-life framework for EV batteries, and noted that the mould-making sector was not consulted before the decision to import Chinese EVs.

The committee spent the final portion of the meeting debating motions and amendments. A motion to "unequivocally condemn forced labour practices in China" was moved, and an amendment to add "and that the committee condemn the comments made by the member for Markham—Unionville" was proposed but not adopted. A further amendment to change "in China" to "globally" was ruled out of order by the chair, a ruling sustained on a vote of five to four. The committee then adjourned without completing the study or hearing further testimony from the witnesses.