Brazil Now Top Destination For Chinese EVs As Exports Explode
Chinese electric vehicle exporters have dramatically bumped up their shipments to Brazil, making the country their top destination this year.
Chinese exports of pure electric and plug-in hybrid cars to Brazil soared 13-fold year-on-year to 40,163 units in April, making it the biggest export market for a second straight month, data from the China Passenger Car Association (CPCA) showed.
The steep increase in exports to Brazil, which was the 10th largest export market in January, came as Chinese electric vehicle-makers reduced shipments to European markets ahead of an anti-subsidy probe by the EU.
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The European Commission is expected to announce by early June whether it will impose tariffs on imports of Chinese EVs. Ahead of that decision, exports of China-made electric passenger vehicles to the EU slumped nearly 20% in the first two months of the year.
Furthermore, exports to Spain, France, the Netherlands and Norway saw the biggest falls between January and April, according to CPCA data.
Belgium, which had so far been the biggest destination for Chinese EV exports, also saw a fall in shipments. Fewer sales in the country have also meant that hundreds of thousands of Chinese EVs have been left parked on Belgium’s ports — some for more than year.
Brazil’s tariff plan
The jump in exports to Brazil also comes ahead of a planned increase in tariffs on EVs and hybrid vehicle imports from July.
Brazil had reduced import taxes on electric vehicles to zero since 2015. But President Luiz Inacio Lula da Silva is restoring them this year to encourage development of the domestic auto industry.
Importation of 100% electric vehicles (EV) became subject to a 10% tax in January, which will increase to 18% in July and eventually reach 35% in July 2026.
Several Chinese automakers have already started increasing investments for local production in Brazil.
BYD, has started building a manufacturing complex there to begin local production by year-end or in early 2025 and Great Wall Motor has said that its Brazil plant would begin operations this month.
536% jump in all car exports
Brazil also became China’s second-largest export destination for all cars in April, trailing Russia which retained its top spot.
Chinese auto exports to Brazil jumped 536% to 106,448 in the first four months of this year.
EU’s anti-subsidy probe has disrupted Chinese vehicle exports to the bloc, but the country’s carmakers have been actively exploring South America, Australia and ASEAN markets for exports, CPCA secretary general Cui Dongshu said.
Meanwhile, Russia, which is subject to Western sanctions, is expected to remain China’s largest car export market, Cui said.
Chinese car shipments to Russia increased 23% to 268,779 vehicles between January and April. Exports to Mexico jumped 27% to 148,705 vehicles during the same period.
- Reuters, with additional editing by Vishakha Saxena
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