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Hot mic and a quota
At the G7 summit in Évian-les-Bains, France, Canadian Prime Minister Mark Carney was caught on a hot mic reassuring U.S. President Donald Trump that Canada would cap imports of Chinese electric vehicles.
“Canada Moves Away from Trump After Electric Vehicle Deal with China”
In the footage, Carney can be heard saying "cap" and then "Less than 3 percent of our market—49,000 cars," while Trump replied, "That's good, I like that."
Newsweek said the exchange marked the first publicly visible conversation between the two leaders on the EV deal since Canada announced it in January.
The deal Carney referenced was announced on January 16, when Canada replaced its 100% surtax on Chinese-made electric vehicles with a most-favored-nation tariff rate of 6.1% for up to 49,000 vehicles per year.
Newsweek added that the quota was set to take effect on March 1, 2026, with shipment-specific import permits issued by Global Affairs Canada.
Trump’s threats, Carney’s line
Carney’s reassurance came after Trump had threatened to impose a 100 percent tariff on Canadian goods if Ottawa pursued a trade deal with China, a warning Newsweek tied to Carney’s January visit to Beijing.
Euronews reported that Carney said his country had no intention of negotiating a free-trade agreement with China, insisting that "We have no intention of doing so with China or with any other non-market economy."
Euronews also quoted Trump’s Truth Social post claiming, "China is fully and successfully taking over what was once the great country that is Canada."
In the same coverage, Euronews said Carney explained that under the USMCA there are commitments not to conclude free-trade agreements with non-market economies without prior notification.
Newsweek further described how Carney’s agreement included a commitment to import Chinese electric vehicles and a reduction of retaliatory tariffs on Canadian canola to around 15 percent from 85 percent.
USMCA review and industry risk
The hot mic exchange landed less than two weeks before a North American trade deadline, with Newsweek saying the Canada-United States-Mexico Agreement, known as CUSMA in Canada and USMCA in the United States, enters its first mandatory joint review under Article 34.7 on July 1.
“Canadian Prime Minister Mark Carney was caught on a hot microphone defending his country’s Chinese EV import deal directly to US President Donald Trump during the G7 leaders’ summit in Évian-les-Bains on Tuesday”
Newsweek also quoted Chad Brown of the Peterson Institute for International Economics saying, "Canada importing 49,000 EVs from China reduces the potential scale achievable in North America," and warned that greater alignment with China could risk fragmenting the broader North American auto supply chain.
In parallel, the Electric Vehicles | Other report said Canada’s quota structure was administered through shipment-specific import permits issued by Global Affairs Canada and that the quota was split into two six-month allocation windows of 24,500 units each.
The same report said Chinese-built EVs imported under the quota are not eligible for Canada’s $5,000 federal EVAP rebate, and it described backlash from North American automakers through the Canadian Vehicle Manufacturers Association.
It added that Transportation Secretary Sean Duffy said in February that Canada would "regret" the decision, while Trump threatened 100% tariffs on all Canadian goods if Ottawa pursued deeper trade ties with Beijing.
