US government proposals to create new electric vehicle tax credits for American-built vehicles could harm the Canadian auto industry and fall foul of trade agreements.
In the letter dated Oct. 22, Canadian Trade Minister Mary Ng told U.S. lawmakers and the Biden administration that the credits, if approved, “would have a major adverse impact on the future of EV and automotive production in Canada.”
She said this would raise the risk of severe economic harm and tens of thousands of job losses in one of Canada’s largest manufacturing sectors, adding that U.S. companies and workers would not be immune from the fallout. The auto industry in both nations is highly integrated.
Ng said the proposed credits were inconsistent with U.S. obligations under the USMCA and the World Trade Organization.
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