Chinese electric vehicle giant BYD is set to begin assembling battery electric vehicles (BEVs) in Brazil this year. The Shenzhen, China-based automaker first entered the Brazilian market in 2021 and sold more than 100,000 electric cars before the Brazilian government reintroduced import tariffs on BEVs, hybrid electric vehicles (HEVs), and plug-in hybrid electric vehicles (PHEVs). With their introduction, BYD risked losing access to its largest foreign market as the import duties would make it increasingly harder for the automaker to sell its affordable electric cars at low prices in Brazil.
To avoid paying import tariffs on its electric cars, BYD decided to build a new EV assembly factory in Camaçari, Bahia that would enable it to bypass import tariffs by manufacturing vehicles within Brazil. With BYD and other Chinese electric vehicle companies essentially locked out of the European, American, and Canadian markets via high import tariffs, South American economies like Brazil and Argentina are among the largest vehicle markets that are still accessible to BYD. Losing access to this market would be a major setback for BYD’s global ambitions.
Consequently, BYD has invested $1 billion into building its Brazilian facility and plans to assemble 50,000 electric cars at the campus yearly. According to a BYD executive, the facility is ready to start vehicle assembly in July 2026 and its timeline will not be disrupted by an ongoing labor lawsuit against the firm. Brazil BYD Vice President Alexandre Baldy says the automaker intends to assemble 50,000 vehicles using imported kits and noted that BYD is currently negotiating reduced tax rates for the Brazil-assembled electric cars.
While speaking during a recent interview, the executive said that the firm is already finished with its 2025 imports, signaling a several months-long period where BYD exported EVs to Brazil en masse before the country’s import tariffs went up. Data published by Reuters shows that the world-leading EV maker imported 22,000 electric vehicle units to Brazil between January and June as the automaker took advantage of the country’s policy excluding electric cars from import tariffs.
BYD Brazil Vice President Baldy says once the vehicle assembly facility in Camaçari is fully operational, it could create up to 20,000 indirect and direct employment opportunities. He also confirmed that BYD is considering expansion into other South American markets such as Colombia, Chile, and Argentina, especially as high tariffs in the U.S., Canada, and most of the EU prevent the company from selling its EVs there at competitive prices.
It would be interesting to hear what ideas firms like SolarBank Corp. (NASDAQ: SUUN) (Cboe CA: SUNN) (FSE: GY2) have for similarly expanding their footprint into the lucrative South American market for clean technologies like EVs and solar energy products.
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