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Canada has become the latest country to crack down on Chinese EVs.
The Canadian government announced Monday that it will impose a 100% tax on all China-made EVs from October after the US and EU unveiled their own trade barriers earlier this year.
The tariffs, which also include a 25% tax on steel and aluminum products from China, will apply in addition to an existing 6.1% tax on China-made EVs.
Western countries are cracking down on China's EV giants over fears that a wave of cheap Chinese vehicles could soon upend their automotive industries.
Chinese automakers such as BYD, which sells cars from around $10,000 in China, have expanded rapidly in recent years and are setting up factories around the world.
Canada's new trade barriers could prove problematic for both Tesla and BYD, which have been locked in a global battle for EV dominance.
A Canadian official confirmed to Reuters that the 100% tariff will apply to cars made by Tesla in China.
While its not clear how many EVs Tesla exports from China to Canada, the new tariffs could force the automaker to shift production to markets with friendlier trade agreements with Canada, such as the US.
BYD, meanwhile, has been considering entering the Canadian market, according to a regulatory filing reported by Reuters.
The carmaker launched a hybrid pickup truck called the Shark in Mexico earlier this year as it continues to expand into North America, but the new round of tariffs could complicate any attempt to sell its electric vehicles in the US' northern neighbor.
Canada's crackdown on Chinese EVs follows in the footsteps of the US and the EU, which have both imposed sweeping new tariffs on Chinese electric vehicles in recent months.
President Joe Biden announced a 100% tariff on Chinese EVs back in May, while the EU has imposed tariffs of up to 36.3% on Chinese manufacturers.
Tesla and BYD did not respond to a request for comment from Business Insider, made outside normal working hours.
