Tesla intros cheapest Model 3 Premium to Canada as it cuts Performance trim price by 17%

Tesla has been reshuffling its Model 3 supply chain in North America as Canada dropped tariffs for China-made cars, and the result is the most affordable version of the electric sedan the country has ever seen.

The new Model 3 Premium RWD starts at C$39,490, or just $29,000 in US dollars, a record-low price made possible by sourcing the vehicle from Giga Shanghai rather than the Fremont, California plant.

The backstory is a tariff tango that has been worthy of a policy thriller ever since the introduction of tariffs as a main economics policy tool by the current White House administration last spring. Before late 2024, Tesla already supplied Canada with Shanghai-built Model 3s. Then came Canada's 100% surtax on Chinese EVs, forcing a pivot to Fremont. That plan collapsed when Canada then slapped 25% counter-tariffs on US-made vehicles, sending the Model 3 Long Range AWD to a painful C$79,990, a price that was a cool 100% higher than the current starting tag of the Model 3 there.

The solution was Shanghai again, this time under a far more palatable 6.1% tariff rate that Canada introduced at the beginning of 2026. The Long Range trim has now been discontinued entirely, too, making the two-trim lineup rather simple: Premium RWD at C$39,490 before destination fees and Performance at C$74,990, which in itself is a 17% reduction from its previous C$89,990 sticker.

The new for Canada Premium RWD trim delivers 463 km of range and a 4.2-second 0–100 km/h acceleration, while the Performance version upgrades it with a front axle motor, a 3.1-second launch, and a 262 km/h top speed for C$35,500 more.

Since the Premium RWD trim is assembled in China, it shouldn't qualify for Canada's C$5,000 federal EVAP rebate valid for sub-C$50,000 vehicles, so Tesla likely sells these at a very low profit margin designed to combat the potential for an onslaught of Chinese vehicles at a 6% tariff in Canada.

Still, provincial incentives may stack further savings on top, as Tesla is likely hoping to compensate for the low per-vehicle profit with a monthly FSD subscription. Deliveries are expected as early as May or June 2026, with Tesla's Giga Shanghai imports turning the Premium Model 3 into the best EV value in North America, a feat that won’t be easily replicated in the US any time soon given the tariff turbulence.

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