Canada deal on Chinese EVs shows trade ‘trumps national security’: experts – National | Globalnews.ca

Chinese electric vehicles still pose a threat to national security despite Canada lifting its tariff block, security experts warn. Nothing has changed since the previous federal government raised its concerns almost two years ago.

Yet these experts also warn that cybersecurity and privacy threats extend from Chinese-made vehicles to any car connected to the internet, requiring a strong response from Ottawa.

The new trade deal signed by Prime Minister Mark Carney and Chinese President Xi Jinping in Beijing on January 16 will allow up to 49,000 Chinese electric vehicles to enter Canada at a significantly reduced tariff of 6.1 per cent, in exchange for China lifting tariffs on Canadian agricultural goods.

Ontario Premier Doug Ford has blasted the deal, warning not only of the impact on the province’s auto sector but also of cybersecurity concerns surrounding Chinese electric vehicles, which he has called “spy vehicles.”

“If you pick up your cell phone, it’s the Chinese — and I’m not making this up — who will be listening to your phone call,” he told delegates at the Rural Ontario Municipal Association conference in Toronto last week.

Experts say the ability for Chinese governments or companies to use internet-connected vehicles to listen in on drivers’ phone calls or record their movements remains a very real threat, especially to Canada’s Chinese diaspora.

There are also broader cybersecurity concerns, said Neil Bisson, director of the Global Intelligence Knowledge Network and a retired intelligence officer with the Canadian Security Intelligence Service.

“It just provides an additional gateway to our infrastructure, both in terms of communications and in terms of energy, because we’re going to connect these vehicles to our own electrical infrastructure,” he said in an interview.

“The possibilities to potentially carry out cyber attacks, to shut down critical infrastructure, it’s all there.”

Carney has said the EV deal with China, which includes a provision that half of those imported vehicles must cost less than $35,000 by 2030, will make electric vehicles more affordable for Canadians.

“I think trade has essentially trumped national security,” Bisson said, especially given Carney’s efforts to diversify the Canadian economy away from the US.

“The unfortunate thing is that in deciding to do this, we are isolating ourselves from some of our Five Eye partners, including the United States, who have also said that Chinese-made electric vehicles pose a threat to national security.”

In June 2024, as Ottawa weighed whether to adjust U.S. tariffs on Chinese EVs to prevent those cheaper models from flooding the North American market, then-Deputy Prime Minister Chrystia Freeland made it clear that the concerns were not just economic.

“We’re also looking at the national security aspect of this: the security aspect, including cybersecurity, when it comes to Chinese exports of high-tech products like electric cars,” Freeland said.

Not long after these comments, Canada ultimately went ahead with imposing 100 percent tariffs on all electric vehicles made in China.

In September of the same year, Freeland said Ottawa was “absolutely” considering following the United States’ lead in banning Chinese automotive software on all vehicles sold in Canada, although that ban has not yet materialized.

At the time of Freeland’s comments, David Shipley, the CEO of New Brunswick-based cybersecurity company Beauceron Security, called these EVs “rolling spy cars” because of the technology they contain, including microphones and cameras.

That assessment hasn’t changed 18 months later, he told Global News in a new interview.

“The concern about China is that China is motivated to do this,” he said, “and that they have the capabilities and the legal infrastructure and requirements for their companies to cooperate with them” under China’s national security laws.

Those same authorities are behind the espionage and national security concerns surrounding TikTok, prompting efforts in the US to try to ban the popular video-sharing app or divest its US business component from Chinese owner ByteDance.

Yet Shipley said there is a bigger problem facing Canada: that every equivalent EV or other internet-connected vehicle – regardless of where it is produced – has the same vulnerabilities, which Chinese state-sponsored cyber actors can also exploit.

“If they want to spy on a connected car, they’re not just going to spy on their own car – they’re going to spy on every internet-connected car because they’re smart enough, they can figure it out, and they absolutely can do it,” he said.

Popular now

• Some Canadians are getting a GST credit to address grocery costs: Carney

• ‘I meant what I said:’ Carney says he didn’t walk the Davos speech back to Trump

“So it’s myopic to focus solely on Chinese-made vehicles, because the issues we’re talking about are across brands. I’m as uncomfortable with Tesla’s ability to listen to me as I am with Beijing.”

In 2021, China banned Tesla vehicles from parking or driving near certain government and military complexes due to the same spying concerns applied against Chinese-made electric vehicles.

Shipley added that he has raised these concerns and the need for regulations to protect the data privacy of Canadian drivers with senior federal government officials, but no action has been taken on these warnings.

“The response of our leadership was to focus on all the other crises of the day,” he said.

“This is one of those things where Canadian public policy is failing at best. It’s a low-probability, high-impact event. We’re very good at dealing with frequent low-impact events, but we’re bad at thinking through their consequences.”

In an interview with the Toronto Star last week, Public Safety Minister Gary Anandasangaree said the federal government does not share Ford’s concerns about Chinese EVs spying on Canadians.

“I’ll let the Premier of Ontario offer his perspective, but from a Canadian safety and security perspective, public safety, we’re not concerned,” he said.

“All vehicles coming in will have to meet Canadian standards.”

Anandasangaree’s office did not respond to Global News’ questions about those comments, including how the administration came to that conclusion or otherwise shifted its position from Freeland’s 2024 comments.

Finance Minister François-Philippe Champagne told reporters in Ottawa on Monday that it is necessary to engage with China “but with eyes wide open” and that there will be “guardrails” and reviews of foreign investments.

He said the goal was to strike deals that are “beneficial to Canadian consumers and Canadian industry, and taking into account what our other G7 partners are doing around the world.”

Shipley said he has proposed a consumer rights bill for any vehicle connected to the Internet 24 hours a day, 7 days a week, requiring manufacturers to issue security updates when bugs are found in the software and conduct mandatory testing for new and emerging cyber threats.

Drivers should also have the ability to disconnect their vehicles from the internet in the event of a security breach and still be able to drive normally, he added.

“There was a hack I saw in Las Vegas where someone discovered how to hack into a car dealer’s network and then track individual vehicles, find their location and more,” he said. “And that creates all kinds of privacy, but also safety, risks for people like victims of intimate partner violence. These are clear.

“We have known for ten years that you can take control of certain vehicles remotely, via the internet, and potentially cause life-threatening situations. And we have done nothing.”

—With files from Touria Izri of Global News