Japanese automakers earned Canada's trust. Will China do the same with EVs?
Ottawa’s recent decision to allow Chinese electric vehicle imports into the country has raised concerns in some quarters about issues ranging from Canadian jobs to national security. It isn’t the first time the arrival of a foreign auto power has been met with trepidation.
In the late 1960s and early 1970s, Japanese automakers Toyota Motor Corp. and Honda Motor Co. Ltd. were just breaking into the Canadian market. Toyota Canada was established in 1964, selling models such as the Crown and Land Cruiser. Honda Canada followed in 1969, first with motorcycles and power equipment, before introducing the popular Civic in the early 1970s.
Sales were modest. The reaction was not.
Labour unions and policymakers warned of job losses and widening trade deficits. Japanese vehicles were criticized as small, cheaply built and poorly suited to harsh Canadian winters. The broader fear was familiar: foreign competition would hollow out domestic manufacturing .
Consumers saw it differently . Drawn by affordability and fuel efficiency, they kept buying.
The oil crises of 1973 and 1979 accelerated the shift. As fuel prices spiked and recession hit, efficient Japanese cars surged in popularity while Canada’s auto sector faced layoffs and restructuring. Political resistance intensified. In Vancouver, a key port for Asian imports, protests, vandalism and labour-related port disruptions slowed vehicle processing. Some observers at times described these incidents as “Vancouver harassment,” reflecting the economic anxiety of the moment.
The complaint at the time was straightforward: they sell here but do not build here.
From outsiders to anchors
That criticism began to lose force in the mid-to-late 1980s. Honda opened its Alliston, Ont., plant in 1986 and Toyota began production in Cambridge in 1988. Currency pressures, political backlash and a North American trade structure that favoured domestic manufacturers made local production increasingly necessary. The debate shifted from imports to investment, from trade deficits to jobs, suppliers and exports.
Today, Toyota employs roughly 8,500 people in Canada, primarily in Ontario, and Honda about 4,000. Tens of thousands more work in supplier networks linked to them. Most vehicles built in their Canadian plants are exported, largely to the United States, contributing significantly to Canada’s automotive trade performance. In 2025, these vehicles accounted for 76.5 per cent of Canada’s overall vehicle production, according to Global Automakers of Canada, an industry group.
They also sell exceptionally well in Canada. Toyota and Honda models consistently rank among Canada’s top-selling vehicles. What began as foreign competition became industrial integration. Canada evolved into one of the most productive manufacturing bases in their global networks. The relationship became reciprocal.
History shows that initial fear of foreign automakers can give way to long-term integration and even pride, but only under certain economic and political conditions. Foreign automotive disruptors tend to follow a recognizable cycle: fear, resistance, proof of value and integration, if governments, markets and companies align.
Japanese automakers followed that path, but new entrants may be charting a different course.
The arrival of Chinese electric vehicles is no longer theoretical. It has been announced and is unfolding within broader efforts to diversify Canada’s trade options and renew its industrial strategy. As before, concerns centre on domestic jobs, trade imbalances and strategic dependence. But consumer dynamics may again prove decisive.
Affordability is the central driver. AutoTrader’s EV research over the past four years consistently identifies purchase price as one of the top barriers to EV adoption in Canada, alongside range anxiety and charging infrastructure availability. Lower-cost electric vehicles could directly address one of the most persistent obstacles to broader adoption. Just as fuel prices reshaped purchasing behaviour in the 1970s, affordability could reshape it again.
The parallels are clear. But so are the differences.
What’s changed
The cars themselves are different. Modern electric vehicles are not simply mechanical products. They are connected digital platforms defined by operating systems, over-the-air updates, advanced driver assistance systems and continuous data exchange.
That shift introduces questions that barely existed in the 1970s: cybersecurity resilience, software control, data governance, and long-term digital dependency. It also introduces a national security dimension. Data flows, remote software access, battery supply chains and critical mineral sourcing now intersect with infrastructure security and industrial strategy. Electric vehicles are embedded in the energy transition and in broader economic planning in ways internal combustion vehicles were not.
The geopolitical landscape is also more fragmented. Japan’s expansion into North America occurred within a closely aligned economic and security framework. Today’s environment features greater scrutiny of state-supported industrial models, strategic sectors and supply chain concentration.
This does not mean integration is impossible. It means the conditions are more complex.
The real lesson
The Japanese experience offers a practical lesson, but it’s not a foregone conclusion.
Foreign automakers succeeded in Canada because they invested. They built plants. They created jobs. They embedded themselves in local supply chains. They aligned with Canadian regulatory and economic priorities. Over time, they became stakeholders in Canada’s success.
They now depend on Canadian productivity as much as Canada benefits from their presence.
If new entrants follow that model, integration is possible. If they remain exporters without meaningful domestic investment, resistance will endure. And if software governance, data security and supply chain transparency are not addressed clearly, skepticism will deepen.
History rarely repeats itself in identical form. But it often rhymes.
The debate today is not simply about cheaper vehicles or global competition. It is about the terms under which companies participate in Canada’s industrial and digital future. The question is not whether foreign automakers will operate here, but what Canada will require of them in return.
Looking at how Japanese automakers integrated into Canada’s auto sector shows that the country already has a framework that works. The technology is different today, and the geopolitical context is more complex, but the principle remains the same: access to the Canadian market should come with investment, jobs and clear commitments on data governance, software security and supply chains.
Canada knows how this works. The country has done it before. The real question now is whether it will apply that same clarity and confidence again.
Baris Akyurek is vice-president of insights and intelligence at Autotrader.ca