Canada Signs U.S.-Led G20 Pledge on Subsidised Overproduction of EVs, Batteries and Solar
Canada has signed a United States-led joint ministerial statement with 13 other G20 members and the European Union to coordinate action against state-supported overproduction in electric vehicles, batteries and solar panels.
The pledge was issued as the Joint Ministerial Statement Addressing Structural Excess Capacity and Production after G20 trade ministers met in Milwaukee, Wisconsin, on Sept. 30 and Oct. 1, 2026. The Office of the United States Trade Representative circulated the text on Oct. 7. USTR
The statement was signed by 14 G20 members plus the European Union. It warns that factory overproduction created, sustained or contributed to by government policies is harming the domestic industries of the signatories. It names electric vehicles, batteries, solar panels, chemicals and some semiconductors as the affected industries. The Globe and Mail
In trade terms, excess capacity means factories can produce far more than buyers want. Structural means governments help create and keep that gap in place through subsidies and other support. Think of a neighbourhood with far more bakeries than customers, kept open by public money.
The statement says structural excess capacity and production lead to overproduction and deter market-based investment, meaning private firms hold back from investing on normal commercial terms. The text stops short of naming a country. The sector focus is narrow. Electric vehicles, batteries and solar are the core. Chemicals and selected semiconductors are included. Reuters
Six G20 members did not sign: China, Brazil, Indonesia, Russia, Saudi Arabia and South Africa. U.S. Trade Representative Jamieson Greer said publicly that Canada had signed onto the statement.
For Ottawa, the signature extends a position taken in 2024, when Canada joined the United States in imposing a 100 per cent tariff, an import tax, on Chinese-made electric vehicles. Ottawa imposed a 25 per cent tariff on Chinese steel at the same time. Reuters
Domestic policy has since moved on two tracks. Ottawa will provide C$2.3 billion ($1.68 billion) to fund incentives of up to C$5,000 on electric vehicle purchases or leases by individuals and businesses. Reuters At the same time, Canada and China struck an initial trade deal that will slash tariffs on electric vehicles and canola. Reuters
The broader context here is the dual alignment Ottawa is now trying to manage. Signing a Washington-led communique on harm from subsidised overproduction keeps Canada inside a bloc that includes the United States and the European Union and preserves common ground on industrial policy for electric vehicles and batteries. Pursuing tariff relief with Beijing on electric vehicles and canola points in the other direction, toward selective de-escalation.
In my view, practitioners should read the Milwaukee text less as an enforcement instrument and more as a positioning document. It creates no tariff schedule and sets no remedy. It records a shared diagnosis among signatories and preserves political room for parallel national measures, whether import restrictions, incentives or negotiated exemptions. The list of non-signatories defines the limits of that consensus.
Looking at what this means for Ottawa, the near-term question is coherence. A government that subsidises domestic electric vehicle adoption, maintains high tariff walls erected in 2024, negotiates lower electric vehicle tariffs with China, and signs a statement condemning state-driven overcapacity will need to explain how those instruments fit together. The departments involved will be expected to reconcile trade, industry and climate files without forcing a choice between Washington and Beijing. That explanation will matter in Parliament, in federal-provincial discussions and in the next round of North American trade bargaining.
