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Interface News reporter Wei Yongmeng

According to the Brazilian Electric Vehicle Association (ABVE), in July this year, the number of electric vehicles registered in Brazil reached 15,312, a month-on-month increase of 6.4% and a year-on-year increase of 105%, ranking second in monthly sales in history, second only to December last year (16,279 vehicles).

From January to July this year, the number of electric vehicle registrations in Brazil reached 94,616, exceeding the total number in 2023 (93,927), of which pure electric vehicles accounted for 38% and plug-in hybrid vehicles accounted for 31.7%. ABVE believes that the total sales of electric vehicles in Brazil this year are expected to exceed 150,000.

In 2023, Brazil's automobile production and sales both exceeded 2.3 million units, making it the largest automobile market in South America and the sixth largest in the world. Against the backdrop of a slowdown in the electrification of the global automobile market, Brazil is one of the few large markets that is still maintaining rapid growth.

First of all, this is related to the Brazilian government's positive attitude towards electric vehicles. In 2015, the Brazilian government decided to exempt import tariffs on pure electric vehicles with a driving range of more than 80 kilometers. In 2018, the Brazilian government began to implement the "Rota 2030" plan, proposing the goal of "electric vehicle sales accounting for 30% of Brazil's total car sales in 2030" and will provide tax incentives of up to 19 billion reais by 2028, focusing on promoting sustainable development in the automotive field.

Secondly, as the largest country in South America in terms of both economic strength and population size, Brazil has natural advantages in developing electric vehicles in terms of geography and natural resources. Brazil is very rich in mineral resources, with more than 50 kinds of minerals with abundant reserves, covering the main raw materials of the automobile and new energy automobile industry chain. Among them, the rich lithium mineral resources have attracted many battery manufacturers to build factories locally.

In addition, Brazil is located in the geographical center of South America. Coupled with its vast land area, local production capacity can radiate to all South American countries, so opening the Brazilian market means opening the door to the South American market.

This year, in order to seize the growing electric vehicle market in Brazil, General Motors, Volkswagen, Hyundai, Toyota and others have successively announced investments in Brazil, with the scale of each investment exceeding US$1 billion. Stellantis, the world's fourth largest automaker, plans to invest more than US$6 billion by 2030, the largest among all.

Chinese automakers are also competing for the Brazilian market. In the first half of this year, China exported 171,000 vehicles to Brazil, a year-on-year increase of 488%. Brazil has also become China's third largest export destination for automobiles, second only to Russia and Mexico.

There are three major Chinese auto brands in the Brazilian market, namely Chery, BYD and Great Wall. Chery is the earliest Chinese automaker to set up shop in Brazil, and its Tiggo model was exported there as early as 2009. Since then, it has invested $400 million in building new auto and supporting factories in the country, but currently it still mainly sells fuel-powered vehicles.

BYD is the Chinese automaker with the fastest growth in investment in Brazil in the past two years. BYD Dolphin Mini has become the best-selling electric car in Brazil in April, accounting for more than half of the electric car sales in that month. In March this year, BYD's Brazilian production base complex officially started construction with an investment of 5.5 billion reais, and the annual production capacity of the first phase is expected to be 150,000 vehicles.