DETROIT (AP) — Chinese automakers have made inroads around the world with growing sales of their high-tech, stylish and affordable electric vehicles. That worried competitors even before Canada this week agreed to lower tariffs on Chinese electric vehicles in exchange for concessions on Canadian agricultural products.
Experts now say an easier path to Canada could be a big boost for Chinese automakers looking to dominate the global market — especially as their domestic market weakens. This poses a threat to other automakers, especially American companies.
US officials acknowledged as much on Friday at an assembly plant of jeep maker Stellantis in Toledo, Ohio. Transport Secretary Sean Duffy said the Chinese Communist Party was investing in its car industry to “control this industry”.
“Why? They want to take over the auto industry. They want to eliminate these jobs,” Duffy said. Regarding the trade deal with Canada, he added: “They’re going to live to rue the day they want to partner with China and bring in their vehicles.”
Others say change is inevitable.
“This tells us that Chinese automakers continue to be really popular and doing better and better, and not just something that’s being sold in global markets that are more marginal or less important to U.S. automakers,” said Ilaria Mazzocco, deputy director and senior fellow with the Trustee Chair in Chinese Business and Economics at the Center for Strategic and International Studies.
What makes Chinese vehicles stand out?
Chinese-made vehicles are high-quality, stylish and cheap, say experts.
“It is clear that the vehicles produced by Chinese brands are very competitive in cost, but they are also quite desirable from a technological point of view,” said Mazzocco. “They tend to be connected vehicles, so they have a lot of additional software capabilities that consumers seem to like. But price and competitiveness are really big selling points.”
These vehicles can cost anywhere from $10,000 to $20,000; in the US, new vehicles run close to $50,000 on average, and EVs even more.
Chinese companies also have unique advantages in automobile manufacturing and production, vehicle efficiency and lightness, which help extend the driving range of an electrified vehicle.
“They found a way to make small and midsize cars — cars that people want — at a reasonable price,” said Sam Fiorani, vice president at AutoForecast Solutions. “These are the segments where GM and Ford and pretty much everyone else has abandoned.”
Many automakers have discontinued smaller vehicles in favor of larger, higher-margin SUVs and trucks that are much more profitable.
So why are Chinese EVs such a threat to US automakers and others?
Much of the global auto market is electrifying, an ideal opportunity to capitalize on advanced automakers. China has seen 17% growth in plug-in hybrid and electric vehicles in 2025, according to data released by Benchmark Mineral Intelligence this week, and Europe has seen 33% growth.
Meanwhile, sales of electrified cars in the US rose just 1% last year. As the rest of the world moves forward, U.S. automakers have scaled back their once-ambitious multibillion-dollar electrification plans, opting instead for more efficient gasoline and electric hybrids amid the Trump administration’s abandonment of EV-friendly policies.
This shift threatens the competitive advantage of American automakers in the coming years. As it stands, Tesla lost its crown as the world’s best-selling electric vehicle maker last year, delivering just 1.64 million vehicles in 2025 to Chinese rival BYD’s 2.26 million.
The Trump administration’s policy of easing emissions rules at a time when Chinese companies are making rapid progress has experts worried about the future of American automakers.
Chinese automakers will have to meet the standards required by the Canadian auto market for the latest trade deal to succeed — standards that are similar to those in the U.S. — which are likely to spur Chinese investment in Canadian auto manufacturing.
They will also need to determine which market segment they are targeting there: high-end vehicles or the least expensive ones that sell in higher volumes.
Regardless, “It brings it home to what it takes to compete globally,” said Mark Wakefield, global automotive market leader at AlixPartners. The firm estimates that Chinese brands will account for 30% of the global market by 2030.
“They already started in Europe. They started in South America. Now in Mexico and Canada,” Wakefield said. American carmakers “don’t want to end up like Brazil with your ethanol cars that can’t be sold anywhere else in the world and … like the UK or Australia, which used to matter in the automotive world and don’t really matter anymore.”
Why have others sought to regulate the expansion of Chinese electric vehicle manufacturers?
Countries have tried to regulate the entry of Chinese electric vehicles into their markets for several reasons.
“China has become this overwhelming machine that makes cheap vehicles. And the fear is that if you give them an inch, they’ll take a mile,” Fiorani said. “The other issue is the technology. These vehicles are data centers … and the idea that a Chinese state-owned company could have access to where a lot of drivers go gives them leverage for all kinds of outlets.”
The European Union raised tariffs on Chinese electric vehicles last year, although the two resolved this earlier this year.
In 2024, former President Joe Biden set a 100 percent tariff on electric cars in China. Canada equalized the import tax on vehicles until this week. And even with an annual import cap, Canada slashing its tariffs this week means those companies are one step closer to U.S. soil. The Mexican auto market welcomed Chinese electric vehicles with massive growth last year.
“The advance of Chinese manufacturers is inevitable. It will happen eventually. Everyone is negotiating to put up obstacles to figure out: what data is processed, how much market share will you allow Chinese manufacturers to have?” Fiorani added.
“There are a lot of railings that need to be put in place, but eventually they will make their way into all Western markets.”
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Alexa St. John is an Associated Press climate reporter. Follow her on X: @alexa_stjohn. Contact her at ast.john@ap.org.
