Tesla Slashes Model Y Price in Canada by $15K to Dodge Tariffs
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It's a dramatic reversal that underlines just how brutal this year has been for Tesla in foreign markets. With a 25% surtax imposed by the Canadian government in retaliation for Trump-era U.S. tariffs, the company was forced to hike prices sharply earlier this year. Now, with sales virtually evaporated, Tesla is playing catch-up.
According to reports from Electrek and others, Tesla is now importing the Model Y from its Berlin Gigafactory—rather than its U.S. plants—to bypass Canadian tariffs. While the Model 3 continues to be sourced from the U.S. and still suffers from the surcharge, the Berlin-built Model Y is slipping under the radar. That's created a rare pricing anomaly: the larger Model Y is now significantly cheaper than the Model 3 in Canada.
Buyers on X (formerly Twitter) were quick to notice. 'The Model 3 is 79,990. The Model Y is 64,990. I wonder what they want to sell,' said one user. Another joked, '$20,000 Jesus.' Still others lamented just missing out: 'Feel bad for those who paid 85K.'
For now, Canadian consumers are the clear winners, especially those in Québec, where the new sub-CAD $65,000 pricing requalifies the Model Y for provincial EV incentives. But for Tesla, it's a different story.
Tesla Model Y Juniper —
Source: Tesla
A Bleeding Global Market
The Canadian collapse is just the latest episode in what's been a tough year globally. In Europe, Tesla has now posted its fifth consecutive monthly sales decline, with registrations across the EU, UK, and EFTA countries plummeting nearly 28% in May compared to a year earlier. The slide suggests rivals like BYD and Volkswagen are beginning to eat into Tesla's share — especially as its aging product lineup begins to feel the strain Tesla Sales Drop in Europe for Fifth Straight Month.
Even at home, things haven't gone smoothly. While Tesla's Q2 delivery numbers were technically better than the most pessimistic analyst forecasts, they were still down nearly 60,000 units year-over-year. Tesla delivered 384,122 vehicles in Q2, down from 443,956 in the same period last year. Analysts at Troy Teslike had expected just 355,000, so markets rallied slightly on the 'less bad than feared' result Tesla's Q2 Sales Drop Year-Over-Year With Surprising Silver Lining.
2025 Tesla Model Y —
Source: Nissan
New Enemies at the Gate
As if Tesla didn't already have enough problems, Nissan is now taking direct aim. The brand recently revealed the 2026 Leaf, now reborn as a crossover SUV with sharp styling, fast-charging capability, and up to 303 miles of range. Even more threatening? It starts in the mid-$30,000s, undercutting the Model Y by a wide margin.
Whether it's tax policy, declining relevance, or fresh competition from legacy OEMs, Tesla's grip on EV dominance is visibly loosening. The pricing chaos in Canada may be a short-term solution, but it also points to a longer-term question: Is Tesla still the disruptor, or is it being disrupted?
For now, Canadian buyers get a win. But the bigger picture? Tesla's house is wobbling—and it's clear that Elon Musk's empire is being tested from all sides.
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