Chinese electric vehicles are making significant inroads in the Latin American automotive market, with major manufacturers such as BYD, Chery, and GWM leading the charge against global competitors like Tesla. According to Allianz Trade, exports of Chinese electric vehicles surged by 1200% in one Latin American country in April 2024, establishing it as the largest destination for these cars outside Asia.
In addition, BYD plans to open factories in various Latin American nations, creating thousands of jobs, while other Chinese companies are already producing locally. This expansion showcases the technological competitiveness of Chinese firms and their ability to leverage trade agreements like the T-MEC to enter the U.S. market.
Brazil stands out as the primary market for Chinese electric cars in Latin America, driven by explosive growth in imports. In 2023, BYD announced investments of $552 million to establish the first electric vehicle factory outside Asia in Brazil. Great Wall Motors (GWM) and Chery have also built local assembly plants, enhancing their production capacity and reducing logistical costs.
Brazil's growing infrastructure to support electromobility is a key factor in the success of these brands. Statista projects that the electric vehicle market in the region will reach $3.51 billion by 2028, solidifying Brazil's role as a central hub for this transformation.
Mexico has also emerged as an ideal platform for Chinese electric vehicle manufacturers to access the U.S. market due to the T-MEC trade agreement, allowing brands to capitalize on tariff benefits in a high-demand region. Companies like BYD and JAC Motors are investing in production plants in Mexico.
Chinese electric vehicle exports to Latin America have quadrupled from 2019 to 2023, capturing a 20% market share in monetary terms. This success is attributed to the aggressive strategies of brands such as BYD, Chery, and Geely, which not only export vehicles but also invest in building factories and distribution networks in key countries like Mexico, Chile, and Argentina.
Chile, for instance, boasts a 28.4% market share for Chinese cars, supported by trade agreements that eliminate tariffs and promote competitive pricing. Meanwhile, Mexico serves as a perfect gateway to international markets, while Brazil combines local production with high internal sales volumes.