Brazil Electric Vehicle Market Insights: Policies, Demand, and Challenges

Brazil's electric vehicle (EV) market is entering a new growth phase, fueled by government incentives, rising consumer awareness, and expanding charging infrastructure. As Latin America's largest automotive market, Brazil is becoming a key player in the global EV transition, offering significant opportunities for automakers, investors, and green technology providers. 

Brazilian Automobile Overview

Brazilian Electric Vehicle Policy

• Import Tax Policy
  • Year of 2024: 0% for within the quota and 10% for the excess;
  • Year of 2025: 0% for within the quota and 18% for the excess;
  • Year of 2026: 35% as estimated, same as internal combustion engine vehicles;
• Encourage the Local Production
  • The MoVer program focuses on green transportation and innovation, offering tax exemptions, such as reductions in the Industrial Products Tax (IPI), to companies producing electric vehicles in Brazil that meet energy efficiency and technological innovation standards. For example, manufacturers that invest in research and development receive additional benefits, thereby promoting the development of local supply chains. With companies like Stellantis and BYD announcing expansion plans, this policy appears to be gaining traction, but its effectiveness depends on investments in infrastructure and a skilled workforce.
• Tax Relief
  • At the federal level, electric vehicles are exempt from the Industrial Product Tax, Goods and Services Tax, significantly reducing their purchase cost. These incentives are part of a strategy to make electric vehicles more widely available, particularly in a market where prices remain high due to reliance on imports. However, since the ICMS is a state tax, not all states offer a full exemption, so the effectiveness of these incentives may vary from state to state.
• Charging Station Construction
  • Proposed requirement for gas stations to be equipped with electric vehicle chargers.

Current Status of Electric Vehicles in Brazil

• PHEV sales are booming, while BEV sales are stagnant. (Unit: Pieces)

• Top 10 HEV sales in Brazil

 

• HEV Brand Sales in Brazil --- Great Wall Motor and Chery entered the top five. 

• Tram Sales Distribution by Region in Brazil --- The southern becomes the main force in electrification.
  • Pure electric vehicles are highly concentrated in the southeast, with São Paulo accounting for 40%;

• • Plug-in hybrid vehicle sales are more balanced, with the share of the Midwest and South increasing. 

• • HEV becomes the most balanced new energy vehicle.

Overview of Charging Station in Brazil --- Charging facilities are uneven between the north and the south. 

• The number of charging piles surged in early 2024 and doubled.