It seems the Tesla Model 3 has been on quite a journey in Canada lately, and not just the kind you'd expect from a road trip. Recent reports suggest that Tesla has completely cleared out its Model 3 inventory in the Canadian market. What's more, any American-made Model 3s that were slated for Canadian dealerships have reportedly been shipped back to the U.S. This isn't just a random inventory shuffle; it's a direct response to some significant policy shifts.
Canada officially launched its new electric vehicle import plan on March 1st. This plan allows up to 49,000 Chinese-made EVs into the country annually, with tariffs dropping to a more manageable 6.1%. Before this, since the start of 2024, Chinese EVs faced a hefty 100% import tariff. This change has certainly shaken things up.
Tesla's supply chain for the Model 3 in Canada has been a bit of a rollercoaster over the past couple of years. Initially, cars came from both Shanghai and Tesla's Fremont factory in the U.S. But when Canada mirrored the U.S. tariff on Chinese EVs at the end of 2023, that supply route was cut off. Tesla then pivoted to relying solely on the Fremont plant.
However, early in 2025, Canada introduced its own counter-tariff, imposing a 25% duty on American-made vehicles. This move significantly jacked up the price of the Model 3 in Canada. For instance, the Long Range All-Wheel Drive version briefly hit a staggering CAD $79,990 (roughly RMB 405,000), with a substantial CAD $25,000 to $30,000 (around RMB 126,000 to 152,000) of that price tag attributed to tariffs alone.
Interestingly, the Model Y had a different escape route. Tesla managed to source it from its Berlin factory, sidestepping the U.S. origin tariffs. The Model 3, however, didn't have this luxury as it's not produced in Europe. Unsurprisingly, with such a price hike, demand for the Model 3 in Canada cooled off considerably.
This led to Tesla's swift strategic adjustment. With the Model 3 inventory now depleted and remaining U.S.-made units heading back home, it's clear the company is navigating a complex trade landscape. Meanwhile, for those still eyeing a Model 3 in China, there are some attractive offers available. As of March 31st, customers can snag an 8,000 RMB discount on specific paint colors and an 8,000 RMB insurance subsidy for designated versions, alongside limited-time financing options like 5-year 0% interest or a 7-year plan. The Rear-Wheel Drive starts at 235,500 RMB, the Long Range Rear-Wheel Drive at 259,500 RMB, the Long Range All-Wheel Drive at 285,500 RMB, and the Performance All-Wheel Drive at 339,500 RMB, with additional perks like a premium in-car entertainment package and 18-inch Photon wheels included.
