On February 1, Tesla started an order-of-magnitude price hike on all of its electric vehicles in Canada. Tesla’s most popular product, the Tesla Model 3, will come with increased cost to a maximum of CAD $9,000, $6,255). Tesla’s Canadian home page has it that the Model Y variant will respond by as much as CAD $4,000, and the premium versions of Model S and Model X will respond by the same amount.
There is no stated rationale for the increase in the Tesla price, as the company has not made any announcement. All of this takes place against a backdrop of intricate trade agreements because Canada has a 100% duty on all electric vehicles imported from China, cars from Tesla Shanghai, etc. Tesla (i.e., electro vehicle, and electrocar) imports into Canada from its U.S. and Shanghai factories, but export vehicle numbers are not available.
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The announcement of the price hike is presented in the wake of a promise made by the ex-Canadian Prime Minister, Justin Trudeau, to be against a 25% import tariff on both Canadian and Mexican products that will take place on February 1. Despite the possibility that the even target tariff can escalate the trade war between the neighboring countries, the impact on whether Tesla applies a market price strategy in Canada has no implications.
Tesla has been a leader in electric vehicle development and is famous both for its global production and export model. Nevertheless, Canadian consumers will be stuck with some of these steep price increases which may impact the Tesla market.
This evolution is indicative of the ongoing difficulties that automotive manufacturers are faced with in delivering the greatest balance between global trade agreements, manufacturing cost factors, and market trends in a constantly evolving marketplace.
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