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Anfavea is on a war footing against Chinese giants GWM and BYD, accusing them of unfair practices by selling cars at ridiculous prices in Brazil. With imports exceeding exports for the first time in years, the national automotive market faces an unprecedented threat.
The Brazilian automotive market has been undergoing significant transformations in recent years.
The growing presence of imported vehicles, especially those from China, has generated intense debates among experts and entities in the sector.
The National Association of Automotive Vehicle Manufacturers (Anfavea) expressed concerns about the impact of this trend on the national industry.
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In 2024, for the first time since 2014, vehicle imports exceeded exports by 60 units.
Sales of Chinese cars in Brazil increased 299% in the year, rising from 32,2 thousand to 105.763 units.
The share of Chinese vehicles in total imports rose from 10% to 26%, while that of Argentina fell from 64% to 48%.
From January to August 2024, vehicle imports registered a growth of 35%, with 279.578 units sold domestically, compared to 207.110 in the same period in 2023.
Increase in Chinese imports
A China has taken the lead in car sales to Brazil in the first half of 2024, with 129.933 vehicles sold from January to June, representing an increase of 717% compared to the same period of the previous year.
This quantity corresponds to 57,5% of the total number of passenger cars imported by Brazil in the period, surpassing Argentina, which sold 41.628 units.
Concerns about high inventory
A Anfavea warned for a record stock of 81,7 thousand electrified Chinese cars in the country, a volume that exceeds the 72.476 units sold in Brazil from January to August 2024.
This scenario raises concerns about possible distortions in the Brazilian market, such as excessive promotions and impact on the competitiveness of local automakers.
Investigations into pricing practices
Anfavea is preparing documents to present to the Ministry of Development, Industry, Commerce and Services (MDIC), aiming to investigate pricing practices of Chinese automakers GWM and BYD.
The main allegation is the practice of dumping, which occurs when products are sold at a price lower than the production cost, damaging the competitive balance of the local market.
In 2024, GWM and BYD accounted for 60% of imported electrified car sales, with 76.800 and 29.200 units sold, respectively.
Chinese investments in Brazil
At the same time, Chinese automakers are investing significantly in Brazil.
BYD has acquired the former Ford plant in Camaçari, Bahia, and is transforming it into a major manufacturing hub for Latin America.
Great Wall Motor (GWM) is also investing in the country, converting a former Mercedes-Benz facility into its South American hub.
These moves are part of a broader strategy to circumvent restrictive tariffs and trade tensions in other markets, focusing on growing regions such as Latin America.
Labor challenges from BYD
However, it is not all good news for Chinese automakers in Brazil. BYD faced a labor scandal at its plant in Bahia, where 163 Chinese workers were rescued in conditions analogous to slavery.
The incident prompted Brazil's Ministry of Foreign Affairs to suspend the granting of temporary visas to BYD, posing a significant challenge to the company in its international expansion.
Future perspectives
The significant increase in imports of Chinese vehicles and investments by Chinese automakers in Brazil indicate a change in the national automotive landscape.
As these companies seek to expand their presence in the Latin American market, entities such as Anfavea are aware of the possible impacts on local industry and market competitiveness.
Ongoing investigations and discussions about pricing practices will be crucial in determining the future of this sector in the country.
For experts, the massive entry of Chinese vehicles into Brazil is redefining the national automotive scene.
While investments bring opportunities for growth and development, it is essential to balance these advances with protecting local industry and ensuring fair market conditions.
The next regulatory and business decisions will be decisive for the future of the Brazilian automotive sector.
We need to know if the prices of cars manufactured in Brazil are in line with the income of buyers in Brazil.
Let's not forget that ANFAVEA is a union for car manufacturers in Brazil.
The law of supply and demand must be respected. If there is a lot of supply, the price will actually fall.
Everyone sets the price they want
Just one detail: Which local automotive industry is really local? Fiat is Italian, GM is American, Honda and Toyota are Japanese, Hyundai is Korean, BMW is German, Peugeot is French. And so on, so many others. And all of them assemble some models here in Brazil and import others. What's the difference between these and BYD? Oh! Okay! BYD isn't part of the union yet, is it? It's not "in the scheme" yet.