Brazil Becomes a Dumping Ground for Chinese Cars, Says Anfavea President

With a 30% increase in vehicle imports in 2024, driven by the arrival of Chinese electric cars, Brazilian automakers are pushing for measures to protect the local industry. According to Anfavea president Márcio de Lima Leite, Brazil is becoming a “dumping market” for China’s production surplus. At the same time, other regions, such as the European Union and the United States, have raised tariffs to curb the entry of Chinese vehicles.

Anfavea data shows that imported vehicle registrations reached 466,500 units in 2024, a 33% increase from the previous year and the highest volume in the last decade. Of this total, approximately 200,000 units were Chinese electric models.

The standard 35% import tariff for vehicles in Brazil was reduced for electrified models, unlike countries such as the U.S. and Europe, which raised tariffs last year. However, the Brazilian government gradually increased these tariffs, with taxes on electric vehicles rising to 18% in 2024, 25% in July 2025, and 35% by 2026. For plug-in hybrids, the tariff will increase from 20% to 35% during the same period.

Leite criticized the impact of low import tariffs: “We, local manufacturers, also use imports, but we cannot lose competitiveness due to these reduced rates.” He also highlighted that Chinese automakers had anticipated large volumes to Brazil in two years.

In December, Brazilian ports were holding 70,000 unsold electric vehicles. This number has since decreased to around 50,000 units. BYD, which purchased the former Ford plant in Camaçari (BA), is leading this movement.

Declining Exports and Trade Challenges

While imports grew, sector exports decreased by 1.3% in 2024, with 398,500 units sent abroad. Argentina increased its purchases, keeping numbers stable, but Brazil lost market share in other regions.

“The sector’s trade balance is facing a perfect storm, with excess imports and a loss of market share in Latin America, which dropped from 24% to 17% in the last five years,” said Leite.

Overall Results and Outlook

Total vehicle sales in Brazil, including trucks and buses, reached 2.6 million units in 2024, a 14.1% increase from the previous year. Production reached 2.5 million units, a 9.7% rise.

Brazil also regained the eighth position in the global producers ranking and became the sixth-largest sales market. The sector moved over BRL 200 billion in vehicle financing credit, a 36% increase compared to 2023.

For 2025, Anfavea projects a 6.3% increase in registrations and a 7.8% rise in production, but it highlights risks related to high interest rates and the strong dollar. “Our goal is to return to the 3 million units sold mark, but we need to face these challenges,” concluded Leite.

Source: Bloomberg Línea

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