Brazil vehicle exports fall 28% early in 2026, Anfavea says

Brazil’s auto industry began 2026 with a sharp drop in vehicle exports, largely driven by the economic slowdown in Argentina, the main overseas market for cars produced in the country.

Data released by Brazil’s National Association of Motor Vehicle Manufacturers (Anfavea) show the country exported 59,400 vehicles in the first two months of 2026, down from 82,400 units in the same period of 2025 — a decline of 28%.

A significant portion of the drop is linked to weaker demand in Argentina. Between January and February, shipments to the neighboring country fell from 15,600 to 14,400 units, a year-on-year decrease of 7.5%.

Anfavea President Igor Calvet said the trend raises concerns for the sector, noting that the slowdown in Argentina is particularly worrying because the country played a key role in driving Brazil’s vehicle exports in 2025.

Last year, exports of vehicles produced in Brazil rose 32% to 528,000 units. Of that total, 302,000 vehicles were shipped to Argentina, reinforcing its position as the main destination for Brazilian-made automobiles. Compared with 2024, exports to Argentina had surged 85%.

The current environment, however, shows signs of cooling. In February, vehicle registrations in Argentina fell 37% from January, reflecting economic uncertainty linked to reforms implemented by President Javier Milei.

Despite weaker demand from Argentina, other Latin American markets helped cushion the decline in Brazilian exports. Mexico stood out, with shipments rising 318% month on month from 2,200 to 9,100 vehicles. Exports to Chile also increased, climbing 34.1% from 1,600 to 2,200 units.

Domestic sales remained broadly stable. Vehicle sales in Brazil totaled 355,700 units in the first two months of the year, down slightly by 0.1% from the same period in 2025. Within that total, passenger cars and light commercial vehicles rose 1.8% to 340,100 units.

The heavy vehicle segment posted a sharper decline. Sales of trucks and buses fell 29.4%, dropping from 22,100 to 15,600 units.

Vehicle production also decreased. Brazilian factories produced 338,000 vehicles in the first two months of the year, an 8.9% decline compared with the same period in 2025.

Meanwhile, the market for electrified vehicles continues to expand. In the first two months of the year, 28,100 units were sold, with 43% produced domestically, according to Anfavea data.

High interest rates remain another challenge for the sector. The increase in Brazil’s benchmark Selic rate during 2025 weighed on both consumption and investment in the automotive industry.

Industry representatives say the effects of any future interest rate cuts typically take around seven months to filter through the economy, meaning more significant improvements are unlikely before 2027.

Source: Paraíba Business

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