Canada’s recent trade deal with China, allowing the import of all-electric vehicles, has caused a major stir. Everyone from the Global Automakers of Canada to General Motors has an opinion on the deal. Many of them are also very concerned about what it means to them.

Prime Minister Mark Carney said Canada will allow China to send 49,000 electric vehicles (EVs) into Canada at a 6.1 percent duty rate, down from the current 106.1 percent. The PM reportedly made the controversial move without any industry consultation.

“The larger reality is we don’t know anything about it,” David Adams, chief executive of the Global Automakers of Canada, a lobby group for Toyota Motor Corp., Honda Motor Co. Ltd., and other foreign automakers, said, according to the Financial Post. “This announcement just throws a wrench in the gears. Nobody knows anything. Nobody can tell you anything, not even the minister’s office.”

General Motors CEO Mary Barra seems equally confused by the move. This week, she told GM employees, “I can’t explain why the decision was made in Canada. It becomes a very slippery slope.”

Is the Canada-China electric vehicles deal a response to America’s tariffs?

Naturally, the Chinese Ambassador to Canada, Wang Di, has a very different outlook on the deal.

“All these projects will be beneficial to the development of the Canadian EV industry, and will be helpful for job growth in Canada, and will help Canadian consumers to be able to buy higher quality and more affordable cars,” Wang told CTV News. “The character of China-Canada practical co-operation is complementarity and mutual benefit.”

“China encourages and supports Chinese companies to make investments and start-up companies here in Canada, on the basis of the market rules,” he continued. “At the same time, we hope that the Canadian side will provide a fair, non-discriminatory, and predictable business environment for the Chinese companies that come here.”

He added, “If Chinese companies will come to Canada to work with Canadian partners for investment, for opening factories or for joint ventures, all of these projects will be win-win.”

His statements have led to speculation that this move is, in part, fueled by retaliation against the Trump administration and its tariffs. Even more so after Wang said, “unlike some other countries, China will not only take into consideration of its selfish interest, we don’t want ‘only we win and others lose.'”

The head of the Canada-China Energy and Environment Forum, Wenran Jiang, hopes the move will open an avenue for Canadian parts manufacturer Magna International to someday partner with a Chinese car manufacturer to build EVs in Canada.

“If they can do that, we can do it certainly here in Ontario,” Jiang said during an online panel by the Institute for Peace and Diplomacy. “We could do probably better if we leverage our regional advantages and work together as a team.”

It remains to be seen whether Chinese electric vehicles pose a real threat to American automakers

To some, the prospect of American drivers buying Chinese electric vehicles poses a real threat to U.S. automakers. There are more than 100 electric vehicle brands in China who would love to sell their EVs to Americans.

“If Ford, General Motors and Stellantis sit back and relax and keep cranking out Rams, F-150s and other trucks, they won’t have a market anymore,” Sam Abuelsamid, vice president of market research at Telemetry, told the Detroit Free-Press. “U.S. consumers will now see more Chinese EVs and customers will say, ‘Why can’t you build a $25,000 EV?'”

BYD recently surpassed Tesla as the world’s number one EV seller. So there is little doubt China would love to expand into the American market. However, some experts are skeptical of that happening. In fact, they believe the move will see Tesla benefit the most – at least in the short term.