Canada's quota for Chinese-built electric vehicles crossed the halfway point in early August, with a Global Affairs Canada report showing 12,513 of the 24,500 first-window permits used, or 51.1 percent of the allocation that runs through August 31. The update also marked a first: conventional, non-plug-in hybrids briefly entered the country under the framework in July before disappearing from the following week's shipments.

The quota replaced a 100 percent surtax that had shut Chinese-built EVs out of Canada since October 2024. Prime Minister Mark Carney negotiated the change during a January 2026 visit to Beijing, and Ottawa formalized it through a notice effective March 1, 2026, that repealed the surtax and reduced the applicable duty to the 6.1 percent most-favoured-nation rate, according to Electric Autonomy Canada. The first-year allocation totals 49,000 vehicles, split evenly into two six-month windows, and is set to grow 6.5 percent annually to roughly 70,000 vehicles by 2030, with a rising share reserved for vehicles priced at $35,000 CAD or less.

Utilization has accelerated steadily since the window opened. Government reports showed 2,910 vehicles cleared by the end of May, 6,531 by mid-July, and 10,113 by the end of the month, before the tally jumped to 12,513 in the first week of August alone. With 11,987 permits left and the window closing August 31, filling the quota would require August imports to roughly double July's record pace, an outcome no prior month has come close to matching.

Tesla (NASDAQ: TSLA)'s Model 3, built at Giga Shanghai, accounted for most of the quota's early use, alongside a smaller shipment of 18 Lotus Eletre SUVs imported under Geely Automobile Holdings (HKG: 0175). The mix shifted in July, when 259 conventional hybrids, classified under a customs code covering non-plug-in hybrid SUVs and passenger vans priced above $35,000 CAD, entered the country for the first time. Electric passenger cars above that same threshold then reasserted themselves in early August, making up 78 percent of that period's volume.

Ford (NYSE: F)'s Lincoln brand confirmed it had resumed Canadian sales of the China-built Nautilus hybrid, in what appears to be the first use of the quota by an established Western automaker for a conventional hybrid model, Automotive News Canada reported. The Nautilus is built exclusively at the Changan Ford joint-venture plant in Hangzhou and had been pulled from Canada after the 2024 surtax took effect. The 2026 Nautilus hybrid starts at $62,996 CAD including delivery, and Ford did not confirm whether the shipment drew on the new import permits.

China-built EVs remain ineligible for the federal Electric Vehicle Affordability Program, which pays up to $5,000 CAD toward a battery-electric vehicle or $2,500 CAD toward a plug-in hybrid but requires the vehicle be built in Canada or in a country holding a free trade agreement with Canada. Volvo Cars Canada has yet to commit to importing Chinese-built EVs under the quota; managing director Matt Girgis told Electric Autonomy Canada the brand "hasn't made any decisions regarding the quota." BYD, Geely and Chery are each said to be preparing a Canadian entry by late 2026, though none has confirmed a shipment date.

Global Affairs Canada has been consulting on how to administer the second six-month window, which opens September 1 and carries forward any permits left unused from the first period. That leaves the door open for automakers still weighing their options once the fall window arrives.

Whether the quota's second half draws the volume its first half fell short of may depend less on the tariff rate than on which automakers decide the Canadian market is worth the paperwork.