The 25% tariff imposed by Canada is based on the car’s value before any taxes are added. This, consequently, has made Tesla autos significantly costlier for Canadians unless the car qualifies for an exemption
Tesla Inc. has increased prices of its electric cars up by nearly 21% across Canada and is encouraging Canadians to purchase before President Donald Trump’s 25% tariff on US made automobiles comes into force. The US EV maker highlighted that vehicles in inventory are “pre-tariff priced” and purchasing them could help buyers save thousands compared to ordering a brand-new one, Bloomberg reported.
“Explore pre-tariff priced inventory while supplies last,” said billionaire Elon Musk’s EV maker’s Canadian website on Saturday.
Following Trump’s tariff announcement on April 2, Canada also imposed a 25% tariff on US-made vehicles from April 9 onwards. Billionaire Elon Musk’s Tesla is caught in the trade tussle between the US and Canada, as most of its cars, including the Model 3, Model Y, Model S, Model X, and Cybertruck, are manufactured in California and Texas.
As long as Tesla cars don’t meet certain requirements under North American content rules under the Canada-US-Mexico Agreement (CUSMA), the American automaker will face a full 25% extra charge.
The 25% tariff imposed by Canada is based on the car’s value before any taxes are added. This, consequently, has made Tesla autos significantly costlier for Canadians unless the car qualifies for an exemption.
However, the increased cost of buying vehicles is reportedly significant. The Tesla Model 3 Long Range All-Wheel Drive now starts at $79,990 Canadian dollar (CAD), up by nearly $11,000. Model 3 Performance is now priced around $89,990, from $79,990. The cheaper Model 3 Rear-Wheel Drive option is no longer for sale here. The new Model Y Long Range is reportedly now costing $84,990, increased by $15,000.
This comes at a time when billionaire Elon Musk’s automaker is already struggling with its financial health. Its net income recorded a 71% decrease to $409 million in the first quarter of the financial year 2025 from $1.39 billion in the same quarter last year. Its revenue fell by 9%, and sales dipped by 20% in Q1 FY25.