Canada Threatens 45,000 Tesla Sales

By Douglas A. McIntyre Published Mar 26, 9:15AM EDT

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Canada has announced a plan that will probably hurt Tesla Inc. (NASDAQ: TSLA) sales there.
The EV maker’s problems in Canada are the tip of a very big iceberg.

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Tesla Inc. (NASDAQ: TSLA | TSLA Price Prediction) sales in Canada have risen steadily for several years and hit 46,000 last year. Sales have plunged this year, and the Canadian government has announced a plan that will probably push them down further.

Tesla sales in Canada dropped 70% between December and January. Tuesday, the government announced that it has frozen the payment of rebates on Tesla vehicles, which will make them much more expensive. “Canada has frozen all rebate payments for Tesla, opened a new tab and banned the electric-vehicle maker from future EV rebate programs, Transport Minister Chrystia Freeland, said,” according to Reuters.

The decision is probably a reaction to 25% tariffs that President Trump said he will put on all imports from Canada, although the government was vague about whether that is the case. Canada also said that Tesla claimed $43 million in “suspicious” rebates a few days before the rebates ended.

The company’s sales in Canada may only be a small percentage of the 1.8 million cars it sold worldwide last year. However, the Canadian drop added to severe falloffs in its most important regions.

In the European Union, its sales declined 47% in February to 11,743, according to the European Automobile Manufacturers’ Association. Although it cannot be proven, there is some evidence that Elon Musk’s relationship with President Trump is partly to blame. Trump has threatened tariffs on goods from Europe, including automobiles.

Tesla’s February sales in China were 11.2% lower than in the same month last year. Its unit sales for the month were 26,777. China is the world’s largest EV market by far, and the company already faces competition from local manufacturers.

Tesla has become the target of Americans who are opposed to his relationship with President Trump. In some cases, its dealers and cars have been vandalized. Tesla trade-ins also hit a record level in February.

Tesla’s problems in Canada are the tip of a very big iceberg.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.