Recently, Tesla has made a major price adjustment in Canada.Among them, the starting price of Model 3 has been cut in half from 79,990 Canadian dollars (about 400,000 yuan) to 39,490 Canadian dollars (about 198,000 yuan), a 50% drop, setting a record low price for Tesla in Canada.. After the price reduction, the Model 3 in the Canadian market is 37,000 yuan lower than the same model in the Chinese market (235,500 yuan), breaking the long-term pattern of "China is the lowest price market for Tesla in the world."
The reason for this is that on the one hand, the Model 3 in the Canadian market has been completely switched from the Fremont factory in the United States to the Shanghai Gigafactory.
As Tesla's lowest-cost production base in the world, the Shanghai factory not only has a highly mature supply chain, but also has more advantageous labor costs, which provides the basic conditions for the price to be cut in half.
In addition, in early 2026, Canada and China reached a tariff agreement, which reduced the import tax rate for Chinese-made electric vehicles within the quota (49,000 units/year) from 100% to 6.1%. The quota in the first half of the year was 24,500 units.
In contrast, vehicles made in the United States still need to pay 25% counter-tariffs, which gives the Chinese-made Model 3 an absolute advantage in terms of cost.
In addition, Tesla's sales in Canada will plummet by 60%-65% in 2025, and it will be overtaken by General Motors and lose the top spot in EV sales.In order to regain the sales crown and prepare for BYD and other Chinese brands to enter the Canadian market, Tesla has drastically cut prices..
It is worth noting that the Chinese-made Model 3 is not eligible for Canada’s federal EV subsidy (up to 5,000 Canadian dollars). Even so, the after-tax price of the new car is still about 37,000 yuan lower than the Chinese market, which is a cost-effective performance.
