Chinese electric automakers have significantly increased their shipments to Brazil amid intensifying trade tensions in the United States and Europe.
Brazil sees influx of low-cost EVs from China
According to Bloomberg, Chinese new energy vehicle giant BYD shipped over 5,400 cars to Brazil via a single ship to supply its main foreign market and to prepare for the potential import tariff hike.
BYD’s Explorer No.1 vessel has completed two voyages since its launch in January: Europe and Suape Port in Pernambuco, Brazil. The vessel reportedly took 27 days from China, carrying electric and hybrid EVs of eight different models.
The report indicated that BYD has yet to officially launch two of these eight models in the Brazilian market, the King sedan and the Song Pro SUV.
Explorer No.1’s captain Nenko Nenkov expects the unloading process to take about 2 ½ days. The vessel will then return to China empty.
Chinese automakers see opportunity in South America
Strong sales of over 24,000 electric vehicles in the first months of this year and an anticipated import tax hike made Brazil a key port for BYD’s new ship, according to BYD Brazil Supply Chain Manager Leonardo Felippe.
It is also worth noting that Chinese battery-electric and plug-in hybrid EV exports to Brazil surged 13 times year-on-year to 40,163 units in April 2024 alone, Asia Financial reports, citing CPCA data. This substantial increase in exports reportedly made Brazil the largest export market for a second straight month.
The South American country will undoubtedly become a key market if Chinese electric automakers will thrive. As EV-a2z reported, the US seeks to curb the surge of Chinese EV imports with its newly announced tariff hike from 25% to 100%. The European Union is also set to determine by early June whether to set its own import barriers against China-made EVs based on its anti-subsidy investigation.
Brazil’s tariff plan
As mentioned, the significant increase in Chinese electric vehicle exports in Brazil came ahead of an anticipated tariff hike on BEV and HEV imports from July 2024.
In hindsight, Brazil has lowered EV import taxes to 0% since 2025. However, President Luiz Inacio Lula da Silva plans to relaunch them this year to boost the local industry and aid its homegrown automakers.
BEV imports faced a 10% tariff duty in January, which will rise to 18% in July 2024 and 35% in July 2026.
These plans prompted several Chinese companies to increase their investments in Brazil’s local manufacturing industry. For instance, BYD is already developing a local manufacturing complex to kick off EV production by the end of the year or in early 2025. Great Wall Motor also expects to start operations at its new Brazilian factory as early as this month.
