Summary
- Latin America’s EV sales are rising
- Mexico and Brazil are the two main players in Latin America’s EV production
- Mexico is a more globalized player, while Brazil is a less globalized market focused on South America
- Mexico has more established legacy auto brands producing EVs, with China still entering the market
- Brazil’s progress in EV production has been influenced by Chinese brands entering the market
Article
The EV market in Latin America is on the rise, with sales increasing in various countries. The region, excluding the Caribbean, amounts to about 5 million vehicles per year, with Brazil and Mexico being the dominant players. Latin America is known for its protectionist policies, which necessitate local production for the EV revolution to succeed. Mexico and Brazil are the two largest markets and producers in the region and have been pioneers in EV production.
Mexico, a globalized player with free-trade agreements and a hub for manufacturing, started producing EVs when legacy auto companies began pivoting to electric vehicles. The country is home to several EV production plants, with Ford, GM, and Stellantis leading the way. JAC, a Chinese brand, also has a presence in Mexico’s EV production market, although legacy auto companies dominate the sector. Kia and BMW are expected to start production of their EV models in Mexico in the near future.
On the other hand, Brazil, a less globalized market, has been influenced by the arrival of Chinese brands in the EV sector. While some legacy auto companies have expressed interest in EV production in Brazil, Chinese brands like Great Wall Motors, Chery, and BYD are leading the charge. Brazil is a significant market for flex-fuel vehicles, and there is a strong ethanol lobby pushing for biofuels as the future of zero-emissions transportation.
In addition to Mexico and Brazil, EV manufacturing in Latin America is limited to two-wheelers, three-wheelers, and quadricycles produced by local brands. The region is facing challenges in developing competitive EVs in these segments, particularly in the case of electric motorcycles, which have not seen significant improvement in value-for-money in recent years. The focus of the analysis was on BEVs, as data for PHEVs was harder to obtain.
Overall, the EV market in Latin America is growing, with Mexico and Brazil leading the way in production. The region’s protectionist policies and local production requirements present both challenges and opportunities for EV manufacturers. As the global shift towards electric vehicles continues, Latin American countries will need to adapt their policies and manufacturing capabilities to support the growth of the EV industry in the region.
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