Electric vehicles for export and containers sitting at a port in Shanghai, China on April 13, 2025.CHINA DAILY/Reuters
The race is on to deliver cheap electric vehicles – or any highly affordable new car – to increasingly cost-conscious Canadian drivers. Automakers seemingly have realized belatedly during this affordability crunch that many of their products are simply too expensive.
The big question now is whether Chinese brands, or their rivals, or indeed any automaker can actually fill the empty chasm at the low end of the Canadian car market. It won’t be easy given high safety standards, manufacturing complexity and the sheer amount of material in modern vehicles.
Having more affordable vehicles to choose from was, perhaps unsurprisingly, the No. 1 reason people supported the federal government’s decision to open the Canadian market to a limited number of Chinese EVs, according to the inaugural Canadian Vehicle Buyer Opinion Study. The study was based on a survey of 2,000 people who had purchased or leased a new vehicle in the past five years. It was conducted and funded by Clarify Group, an automotive industry research and consulting firm based in Markham, Ont.
“Affordability definitely was the key theme,” said Darren Slind, Clarify Group’s co-founder and president.
The majority – 70 per cent – of people in the market for a car want a monthly payment of less than $600, the survey found. Overall cost of ownership – long-term durability, price and efficiency – was cited by consumers as their top consideration.
Some 38 per cent of car buyers would consider a Chinese EV as their next vehicle. It’s an impressively high result considering 48 per cent of respondents didn’t know a single Chinese automaker, even after being prompted with the names of 14 Chinese brands.
How affordable homegrown Chinese EVs will be by the time they hit Canadian dealerships is still a mystery, one we’ll probably have to wait until early 2027 to unravel.
“A number of Chinese [manufacturers] are going through the homologation process as we speak, and what we’re hearing is [the first quarter] of 2027 is the realistic time frame for dealerships to start opening and retail activity to begin,” Slind said. “Not necessarily January 1, but some point in the first quarter.”
When that time comes, I suspect many Canadians might be disappointed by the higher-than-expected cost of some Chinese EVs. And no, I’m not even talking about the $119,000 Lotus Eletre SUV, which was among the first imported to Canada under the quota system.
As we have covered, and experts – including former Toyota Canada executive Stephen Beatty – have pointed out, there will likely be a mismatch between the vehicles offered by Chinese brands and the bargain-basement prices many consumers expect.
Slind said that, based on Clarify Group’s survey results, the perception among Canadians is that Chinese-made vehicles are going to be budget-friendly. “The Chinese brands are going to potentially have to overcome that perception as well. Customers are expecting low prices, and that’s not necessarily what they’re going to see, at least not initially,” he said.
Initially, only 49,000 Chinese EVs are allowed in during the first year of Canada’s quota system. Having such a limited quota could drive up prices as automakers seek to maximize profits.
The quota includes spots reserved for affordable EVs of $35,000 and less, but that’s the import price, not the retail price that brands set for themselves.
So far, as The Globe and Mail reported, about half of the 15,603 Chinese-made EVs in Canada have arrived with an import price below $35,000. If I had to guess, I’d say those are likely base-model Tesla Model 3s, which retail for $42,136.
One silver lining here is that even the mere existence or threat of fresh competition from China seems to be working to drive down prices.
In what seems like a pre-emptive strike against future Chinese competition, Nissan Canada announced a more affordable version of its 2027 Leaf EV with a price tag of $37,966 including freight, which drops to $32,966 after the $5,000 federal rebate. The lower price comes with less driving range (341 kilometres) and oomph (174 horsepower), but for cash-strapped consumers, that may be a worthy trade-off.
Ford chief executive officer Jim Farley has been touting the company’s value-focused EV initiative, calling it a “Model T moment” that could revolutionize the industry. The result is the 2027 Ford Fathom, a midsize electric pickup that starts at $38,690 after a $4,000 federal incentive. Let’s hope it fares better than Ford’s more expensive Lightning EV pickup. That vehicle garnered similar Model T comparisons when it was unveiled in 2021 before being unceremoniously axed from the lineup last year.
Slate Auto, an electric vehicle startup backed by Amazon founder Jeff Bezos, was early in recognizing the industry had “abandoned the majority of Americans,” according to its chief commercial officer, Jeremy Snyder. Slate’s back-to-basics electric pickup will start at US$24,950.
Don’t get too excited, though, because Automotive News reported Slate has no plans to sell its truck in Canada. Could it be because of the U.S. trade war? It certainly doesn’t help. It is a strange reversal of fortunes brought about by America’s bumbling, ruinous trade war; tariffs are keeping at least one American vehicle out of Canada while the new quota system lets Chinese alternatives in.
Even if Chinese and other automakers can pull it off and deliver a buffet of cheaper EVs, it’s unclear if the price will be low enough for buyers to overcome potential issues, including limited range, small size, a lack of brand awareness and untested reliability.
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