U.S. tariffs on the EV supply chain pose policy dilemma for Canada – by Gabriel Friedman (Financial Post – May 21, 2024)


Canadian companies now have more incentive to sell south of the border than in their own country

Eric Desaulniers, chief executive of Montreal-based Nouveau Monde Graphite Inc., figured it was spam when he received an email inviting him to the White House for a vague policy announcement.

But his IT department told him the email was authentic, and days later, on May 14, United States President Joe Biden announced sweeping tariffs on China’s electric-vehicle supply chain that affect everything from EVs themselves to critical minerals, including a 25 per cent tariff on Chinese graphite beginning in 2026.

“I was suspecting a good announcement because why would they invite a graphite producer if it wasn’t good?” Desaulniers said. Although politicians in both the U.S. and Canada frequently speak about their close ties, the race to build an EV supply chain in North America is showing that the sheer size of the U.S. economy gives it a wider range of policy options, and the benefits of that do not always transfer over to Canada.

Desaulniers, who hopes his company will by 2027 be producing graphite from a mine in Saint-Michel-des-Saints, Que., and processing it at a plant in Bécancour, said the tariffs are good news and bad news.

For the rest of this article: https://financialpost.com/commodities/us-tariffs-ev-supply-chain-pose-dilemma-canada