Tesla unveils Model 3 RWD in Canada for $39,490, a record low
Tesla has introduced a new Model 3 Premium RWD trim in Canada, starting at a record-low price of $39,490 CAD (around $29,000 USD). This price is made possible by sourcing the vehicle from Giga Shanghai instead of Fremont, California.
The move marks the first time Tesla is selling China-made vehicles in Canada since the country imposed a 100% tariff on Chinese EVs back in 2024 — and it creates a massive price gap with the Model 3 Performance, News.Az reports, citing foreign media.
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From Fremont to Shanghai and back again
Tesla’s Canadian Model 3 supply chain has been on quite a ride over the past two years. Before late 2024, Tesla supplied Canada with Shanghai-built Model 3 vehicles. When Canada imposed a 100% surtax on Chinese-made EVs, Tesla switched to sourcing from its Fremont factory in California.
That arrangement became untenable when Canada slapped 25% counter-tariffs on US-made vehicles in early 2025, pushing the Model 3 Long Range AWD to a staggering $79,990 CAD. As we reported in March, Tesla responded by shipping its remaining US-built Canadian Model 3 inventory back to the United States, clearing the deck for Shanghai-built replacements.
The catalyst was the tariff deal Prime Minister Mark Carney struck with Beijing in January, which slashed the duty on Chinese-made EVs from 100% to just 6.1% — the standard most-favored-nation rate — under a quota of 49,000 vehicles per year.
Tesla is now the first automaker to capitalize on that deal with actual product in the Canadian market.
The new Canadian Model 3 lineup
The new Model 3 Premium RWD starts at $39,490 CAD and delivers 463 km of range with a 0-100 km/h time of 4.2 seconds. Tesla also cut the Model 3 Performance price by 17% to $74,990 CAD, down from $89,990.
The price difference between the two trims is now $35,500 — nearly double the base price of the Premium RWD. The Performance delivers 478 km of range, a 3.1-second 0-100 km/h sprint, and a 262 km/h top speed.
For most buyers, the Premium RWD at $39,490 offers the better value. You get nearly identical range, solid acceleration, and a price that undercuts virtually every comparable EV in Canada. Paying $35,500 more for a 1.1-second improvement in sprint time and AWD is a tough sell for all but the most performance-focused buyers.
The Premium RWD is a staggering 31% cheaper in Canada than in the United States — a gap that can only be explained by the shift to Giga Shanghai, where production costs are significantly lower than Fremont, and the 6.1% Canadian tariff is a fraction of what US buyers effectively pay for their domestically-built units.
Meanwhile, the Performance is priced nearly identically in both countries when converted to USD. That strongly suggests the Performance is still sourced from Fremont — with the 25% counter-tariff on US-made vehicles largely offsetting any savings Tesla might pass along.
Tesla removed the Model 3 Premium Long Range AWD from the Canadian lineup entirely, which had been priced at $79,990.
The catch: no federal rebate
There’s an important caveat for Canadian buyers. Shanghai-built Model 3 vehicles do not qualify for Canada’s $5,000 Electric Vehicle Affordability Program (EVAP) rebate, which requires vehicles to be manufactured in a country with which Canada has a free-trade agreement. China doesn’t meet that requirement.
That effectively brings the out-of-pocket cost to $39,490 for the Premium RWD — still a record low, but $5,000 more than it would be if the same vehicle qualified for the incentive. For comparison, competitors like the Hyundai Ioniq 5 and Chevrolet Equinox EV do qualify for the EVAP rebate, narrowing the effective price gap.
First customer deliveries on new orders of the new Canadian Model 3 lineup are expected as early as May or June 2026.
By Ulviyya Salmanli
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