Geely Goes North: Canada's Chinese Car U-Turn の全文書き起こし

Chinese electric vehicle industry and its growing exports abroad, the US imposed 100% tariffs on Chinese electric vehicles. 00:02:39.360 --> 00:02:44.560 And very quickly after that, Canada basically moved in lockstep and did so as well. 00:02:44.800 --> 00:02:46.479 Then everything changed. 00:02:46.879 --> 00:02:52.800 Of course, Donald Trump was elected and started threatening to invade and annex Canada. 00:02:52.960 --> 00:03:01.199 And with that, we saw a growing divergence between Canada and the United States on trade issues, but also foreign relations issues. 00:03:01.360 --> 00:03:05.840 So in January, uh now Prime Minister Mark Carney visited China. 00:03:06.080 --> 00:03:10.960 At the time, he made this famous pronouncement while he was there that we are in a new world order. 00:03:11.120 --> 00:03:21.199 And of course, shortly after that, gave his viral Dabo speech that sort of laid out Canada's new position vis-a-vis US and the world. 00:03:21.360 --> 00:03:39.680 And one of the big announcements as well to come out of that Beijing visit was that Canada said that it would drop that 100% tariff on Chinese EVs and also allow in starting this year a limited number of EVs into Canada imported from China, starting with 49,000 cars this year. 00:03:39.840 --> 00:03:43.680 And that number will slowly tick up by 6.5% every year. 00:03:43.919 --> 00:03:50.560 At the same time, Canada is also actively courting Chinese automakers to set up factories in this country. 00:03:50.960 --> 00:03:54.879 BYG has said that it's looking, actively considering it. 00:03:55.120 --> 00:04:06.319 And just last week, we also learned that Leap Motor, which is another Chinese EV company partially owned by Stillantis, is also in active discussions about setting up in a mothballed Stillantis factory here. 00:04:06.560 --> 00:04:08.159 So that's where we stand. 00:04:08.560 --> 00:04:14.879 The US right now doesn't allow Chinese EVs in, but Canada is very much taking a different path. 00:04:15.199 --> 00:04:19.839 What has happened to all the pushback against Chinese EVs that was there in the first place? 00:04:20.079 --> 00:04:24.959 Protecting domestic industry, for example, or the need for alignment with the United States? 00:04:25.120 --> 00:04:28.399 Are these things still concerns for Canadian policymakers? 00:04:28.800 --> 00:04:33.759 So, Savannah, I think this is a good time for me to make a confession. 00:04:34.000 --> 00:04:36.800 This is something our editors don't actually know about. 00:04:36.959 --> 00:04:41.199 And so I'm gonna use this opportunity to share a little bit of a story. 00:04:41.519 --> 00:04:48.560 So in the spring of 2023, um, I was still a relatively new reporter at The Wire. 00:04:49.199 --> 00:04:57.360 And that week in March, uh, President Biden was visiting Canada for his first state visit at the time. 00:04:57.839 --> 00:05:02.079 And I snuck into that summit. 00:05:02.240 --> 00:05:05.680 Um, I had just bought my first car. 00:05:06.000 --> 00:05:16.959 Uh I had a surprisingly light week at work, and so um I got an email from Global Affairs Canada, which is sort of the State Department over here, that was saying, like, do you want a media pass? 00:05:17.120 --> 00:05:18.399 Uh and so I signed up. 00:05:18.560 --> 00:05:22.800 I mean, it was in part that I wanted to go see the president and the prime minister. 00:05:22.959 --> 00:05:25.920 I also wanted to check out Air Force One for myself. 00:05:26.160 --> 00:05:33.920 And so I drove up to Ottawa, and with that time, our editors ended up sort of joining the media pack at that visit. 00:05:34.160 --> 00:05:49.040 So that may be news for them, but uh I will add that in retrospect, um, sneaking off and doing that was actually a really valuable experience because I got to sort of witness the US-Canada relationship that once was. 00:05:49.279 --> 00:05:58.639 So at the time, President Biden gave this address to the House of Commons in Canada, and he he gave this speech that I actually thought was really lovely. 00:05:58.720 --> 00:06:01.759 Um, he described the relationship between the US-Canada. 00:06:01.920 --> 00:06:18.480 I'll just sort of quote a line from that speech in which he said, No two nations on earth are bound by such close ties: friendship, family, commerce, and culture, our labor unions cross borders, so do our sports leagues, baseball, basketball, hockey. 00:06:18.720 --> 00:06:26.800 And then he adds, Americans and Canadians are two people, two countries, in my view, sharing one heart. 00:06:27.680 --> 00:06:29.600 So that's all gone now. 00:06:29.759 --> 00:06:36.399 Uh, thanks to overwhelmingly President Trump's repeated threats to annex Canada. 00:06:36.639 --> 00:06:42.079 Over here, where I live now and have lived for five years, there's this real feeling of betrayal. 00:06:42.399 --> 00:06:47.120 The number of US trips, the canon, the number of Canadian trips to the US are down. 00:06:47.279 --> 00:06:51.279 The country is really quickly trying to diversify its trading partners. 00:06:51.519 --> 00:07:03.199 And the feeling of betrayal is just especially acute in the automotive sector, uh, thanks to cases like Stillantis shuttering a factory in Ontario in order to double down on investment in the US. 00:07:03.360 --> 00:07:08.639 And so there's this feeling that in this industry, there's this zero-sum game uh when it comes to production. 00:07:08.879 --> 00:07:25.839 And I think that's all just really important context to understand why it is that Canada has shifted tack on Chinese EVs and why it is that some of the things that aligned Canada so closely with the US, even two, three years ago, are no longer priorities. 00:07:26.000 --> 00:07:45.839 I think I would also just add to that that while protecting domestic industry is something that's of course important over here, I think one of the factors that made it easier for Canada to embrace Chinese electric vehicles is the fact that for the most

part, there actually isn't a domestic auto industry in the same way that there is in the US. 00:07:46.000 --> 00:07:52.480 Uh, of course, there are factories, but most of those factories are producing cars on behalf of American brands or or foreign brands. 00:07:52.639 --> 00:07:55.519 Like Canada doesn't have a homegrown automaker. 00:07:55.759 --> 00:08:02.639 Just all of those factors together, I think, are important to understanding why it is that we're seeing this divergence when it comes to autos today. 00:08:03.120 --> 00:08:12.959 Thank you, Elliot, for your entrepreneurial reporting and sitting on that anecdote until the time, which we're very lucky is this podcast. 00:08:13.199 --> 00:08:18.160 Um, so let's zero in a little bit on the security concerns. 00:08:18.399 --> 00:08:32.320 I mean, US-Canada relational breakdown aside, a lot of the US actions have been motivated by data collection technology from Chinese EVs and security concerns around that. 00:08:32.559 --> 00:08:37.679 You'll be covering this in our upcoming issue, of course, but let's give a little bit of a preview now. 00:08:37.919 --> 00:08:43.679 You've identified one company that could prove particularly problematic for Canada. 00:08:43.919 --> 00:08:47.360 Can you give us an overview of that company and why it's raising alarms? 00:08:48.000 --> 00:08:52.480 Early on in this podcast, um, I mentioned uh the name Leap Motor. 00:08:52.559 --> 00:08:54.960 Uh, so this is a Chinese EV company. 00:08:55.120 --> 00:08:57.200 It's based in Zhujiang province. 00:08:57.360 --> 00:08:59.600 In Chinese, its name is Ling Pao. 00:08:59.840 --> 00:09:05.200 Most people probably haven't heard of Leap Motor to the extent that people have heard of Chinese EV brands. 00:09:05.360 --> 00:09:09.840 Really, it's companies like Gili or BYD that have really dominated the headlines. 00:09:10.000 --> 00:09:11.679 But Leap Motor is no slouch. 00:09:11.840 --> 00:09:25.600 It made 600,000 cars last year, but it's also controversial because it has had long-standing ties to a controversial Chinese video surveillance company called Dahua Technology. 00:09:25.840 --> 00:09:40.480 Dahua has been blacklisted in the US and the European Union, as well as a number of other countries, which have accused it of aiding repression and surveillance in China, particularly of uh the Uyghurs and Muslim minorities in Xinjiang. 00:09:40.879 --> 00:09:52.000 In the US, Dahua has been added to the 1260H list, which is the Defense Department's list of Chinese companies that are alleged to be contributing to China's military civil fusion strategy. 00:09:52.159 --> 00:09:56.159 And Leap Motor was born out of this company in 2018. 00:09:56.240 --> 00:09:58.240 Um it was basically a spin-out. 00:09:58.720 --> 00:10:02.799 Its largest shareholders were Dahua and Dahua's two co-founders. 00:10:03.120 --> 00:10:31.679 Um, and so at a time when the US and also a number of other Western countries are growing concerned about the

growing data and cybersecurity implications of an increasing number of Chinese connected vehicles rolling out on Western roads, it's notable that here we have an automaker with extensive connections to this highly blacklisted surveillance firm that is also actively considering setting up in Canada. 00:10:32.320 --> 00:10:36.639 So, how close are these connections between Leapmotor and Dahua? 00:10:36.960 --> 00:10:47.200 When Leap Motors founded in 2015, um, as I mentioned, its largest shareholders were Dahua and its two co-founders, Fu Li Chien and Zhu Xiangming. 00:10:47.360 --> 00:10:54.080 In addition to that, Dahua has sort of extensive commercial relationships with Leap Motor. 00:10:54.240 --> 00:11:09.519 In 2023, when Stellantis bought a 21% stake in Leapmotor, Dahua sold its direct stake in the company, but at the same time has uh maintained personnel and commercial relationships with the company. 00:11:09.759 --> 00:11:14.720 So, for example, uh several of Leap Motor's vice presidents previously worked at Dahua. 00:11:14.799 --> 00:11:19.679 One of Dahua's co-founders is now chairman of Leap Motor. 00:11:19.840 --> 00:11:30.159 And the two companies together jointly developed an AI chip that is used for autonomous driving capabilities called Ling Sin01. 00:11:30.240 --> 00:11:32.960 And that chip is embedded in many of Leapmotor's cars. 00:11:33.279 --> 00:11:42.000 For those wanting to know more on what this could imply for Canada, Elliot's story will be published on thewirechina.com this Sunday evening, Eastern Standard Time. 00:11:42.240 --> 00:11:46.159 We'll leave the rest of your reporting for our readers on Sunday. 00:11:46.320 --> 00:11:48.399 But one final question from me, Elliot. 00:11:48.559 --> 00:11:56.639 The context of all of this is, of course, Chinese EV's seemingly unstoppable global rise, as our readers and listeners are no doubt aware. 00:11:56.799 --> 00:12:08.639 We've covered the major players and expansion into markets from Southeast Asia to Latin America on the wire China for some time now, but North America was always a nut that China's car giants could never crack, at least until now. 00:12:08.879 --> 00:12:14.799 Is the world just in an unstoppable wave of Chinese automobile technology that we can no longer avoid? 00:12:14.960 --> 00:12:18.639 Was Canada's decision to allow Chinese EVs inevitable? 00:12:18.960 --> 00:12:23.600 So this is a story that is continuing to play out in real time. 00:12:23.840 --> 00:12:29.440 And I think what's interesting and exciting about it is that it's it's also just changing really quickly. 00:12:29.600 --> 00:12:53.360 On the question of whether this was inevitable and whether these cars might be coming to other countries in North America, I think I would just add that one interesting dynamic that we've also reported about in recent articles is how the US is going to respond to the prospect of an increasing number of these Chinese vehicles, but also Chinese auto factories coming to North America. 00:12:53.600 --> 00:13:02.320 One of the things that seem to have captured President Trump's attention, for example, is the fact that some of these automakers want to build here. 00:13:02.480 --> 00:13:09.440 And we heard from him in January at the Detroit Auto Club saying, let them come in, let them build a factory in the US. 00:13:09.679 --> 00:13:21.600 And that's created a really interesting dynamic here because even though that hasn't happened yet, I think a lot of people in the industry are waiting to see whether a deal will come out of his visit to Beijing in a couple of weeks. 00:13:21.759 --> 00:13:31.200 But also it could create a sort of competition, a bit of a bidding war for these factories in North America that could really play into the hands of the Chinese automakers. 00:13:31.600 --> 00:13:35.279 There's a lot of complicated dynamics that could really tip the balance. 00:13:35.600 --> 00:13:47.759 In Canada, for example, the unions have a really important uh voice when it comes to how factories are set up and also the extent to which the cars will be fully built here. 00:13:47.919 --> 00:13:50.960 Whereas in the US, you know, President Trump may not be so picky. 00:13:51.440 --> 00:14:06.720 He could offer up, for example, as one analyst noted to me, just a plot of tax-free subsidized land in Alabama, where historically unionization rates are lower and automaking has really thrived in the last few years. 00:14:06.960 --> 00:14:14.000 And so if Trump goes to Beijing and announces this deal, we could see the entire landscape change all over again. 00:14:14.240 --> 00:14:20.159 And um this talk about where these EVs are going to show up, um, there could yet change. 00:14:21.360 --> 00:14:26.159 Thank you for revisiting our Canada-China car deal coverage with us today. 00:14:26.320 --> 00:14:31.679 We do have plenty of news stories on our website, however, as part of our latest magazine issue. 00:14:31.919 --> 00:14:43.840 Our cover story by Pei Yu-Wu covers solar farms, actual farms, with solar panels installed over fish ponds and sheep fields, part of a new smart farming push in China. 00:14:44.320 --> 00:14:53.759 As Europe and China continue to duke out a trade deal, motivated, of course, by China's surging car exports, we have two stories covering just that. 00:14:54.080 --> 00:15:01.039 George Magnus of Oxford University's China Center wrote an op-ed on how the EU should use its trade tools. 00:15:01.279 --> 00:15:05.279 And our QA this week is with former EU diplomat Gunnar Wiegand. 00:15:05.919 --> 00:15:09.200 We also spotlight two different sides of science in China. 00:15:09.440 --> 00:15:27.120 I profile Beijing's push to fund more basic scientific research, and Alberta Moel of the Hong Kong University Business School writes about China's quest to advance in lithography technology, a key part of building more advanced semiconductors and currently dominated by the Dutch. 00:15:27.360 --> 00:15:30.879 Make sure to read all these stories on thewirechina.com. 00:15:31.120 --> 00:15:34.879 Thank you all for listening and see you back here next Tuesday.