Canada Pension Board Invests $600M in Chinese EVs as Ottawa Weighs Tariffs to Protect Domestic Industry

A BYD Seal U model car is seen at the stand of the Chinese carmaker at the Geneva International Motor Show in Geneva, on Feb. 27, 2024. Fabrice Coferini/ AFP via Getty Images

Canada’s national pension fund has invested roughly $600 million in China’s electric vehicle (EV) sector, while Ottawa is accusing Beijing of unfair trade practices and mulling potential tariffs on EV imports from China.

The federal government on June 24 announced a public consultation on potential responses to unfair Chinese competition in the auto sector, including imposing tariffs on Chinese EV imports to protect Canada’s workers and growing EV industry. Ottawa is also accusing Beijing of intentionally creating a global oversupply that will erode Canadian EV producers’ profit incentives.

Meanwhile, the Canada Pension Plan Investment Board (CPPIB) holds hundreds of millions of dollars in shares in the Chinese EV sector, according to its “Foreign Publicly Traded Equities“ report released in March, as first covered by Blacklock’s Reporter.

As of March 31, 2024, stock bought with Canada Pension Plan premiums included $287 million in Contemporary Amperex Technology Co. Ltd., a major EV battery manufacturer in Fujian Province. The pension board also owns $12 million in stock from Great Wall Motor Co. Ltd., known for its Ora-brand electric cars.

Other holdings include automakers BYD ($116 million), Li Auto Inc. ($69 million), Chongqing Changan Automobile Co. Ltd. ($26 million), and Nio Inc. ($19 million). Additionally, investments in automotive parts and systems manufacturers include Huizhou Desay SV Auto Co. Ltd. ($13 million), Ningbo Tuopu Group Co. Ltd. ($10 million), and Huayu Automotive Systems Co. Ltd. ($9 million).

The pension board also invested millions in Chinese battery manufacturers and suppliers, including Tianqi Lithium Corp. ($13 million), China Northern Rare Earth Group High-Tech Co. Ltd. (7 million), Eve Energy Co. Ltd. ($7 million), and Ganfeng Lithium Group Co. Ltd. ($6 million).

“Chinese producers are quite intentionally generating a global oversupply that undermines EV producers around the world, including here in Canada,” Deputy Prime Minister Chrystia Freeland said during a June 24 press conference.

The 30-day public consultation, set to begin July 2, aims to receive potential policy responses in order to protect 550,000 Canadian jobs related to the sector, she said.

The Epoch Times contacted the pension board for comment but did not hear back by publication time.

Other China Investments

CPPIB holds a total of nearly $7.9 billion worth of shares in Chinese companies of all types under the “Foreign Publicly Traded Equities“ category. A parliamentary committee had urged the pension board to divest from Chinese companies involved in unethical or illegal practices.

In a report presented to the House of Commons on Dec. 13, 2023, MPs from the House Special Committee on Canada-China Relations specifically referred to Chinese technology giants such as Alibaba and Tencent. These companies were flagged for their connections to Beijing’s repression of Uyghur Muslim minorities in China’s Xinjiang region. The pension board held shares valued at $277 million in Alibaba Group Holding Ltd. and $352 million in Tencent Holdings Ltd., according to its March report.

“There is no legislative or regulatory provision that would prevent investments in the PRC [People’s Republic of China],” the report stated. However, it recommended that the Canadian government “study how it could compile and maintain an official list of companies deemed unsuitable for investment.”

The pension board has also invested in other Chinese companies flagged as security risks by the federal government, including ByteDance, whose flagship video-streaming app TikTok has been banned from all government-issued devices since Feb. 28, 2023, due to security concerns.

TikTok faces U.S. government pressure to separate from its parent company, following President Joe Biden’s signing of a bill on April 24. The mandate requires TikTok to divest from ByteDance within a year or be banned from U.S. app stores and hosting services. This move aims to safeguard Americans’ data security and national security by preventing the Chinese Communist Party from accessing TikTok’s U.S. customer data through ByteDance, according to White House national security communications adviser John Kirby.

Under China’s National Intelligence Law, all Chinese citizens and organizations, including private businesses, are required to “support, assist, and cooperate with national intelligence efforts” of the communist regime.

ByteDance is currently listed under the “Private Equity Asia” category in CPPIB’s holdings.

Matthew Horwood and Omid Ghoreishi contributed to this report.