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The end of BYD in Brazil? The company suffers from a 'car graveyard' without a destination that could represent the failure of the Chinese company on Brazilian soil: did the strategy go wrong?

Written by Alisson Ficher
Published 20/01/2025 às 19:38
BYD faces dilemma with gigantic stock of electric cars in Brazil. Bold strategy or fatal mistake in the national market?
BYD faces dilemma with gigantic stock of electric cars in Brazil. Bold strategy or fatal mistake in the national market?

BYD surprises by importing more than 100 electric cars in an attempt to avoid import taxes. However, challenges such as poor infrastructure and stagnant inventory raise doubts about the brand's future in Brazil.

One of the BYD's controversial decision has still generated doubts and debate about the future of electric cars in Brazil.

The Chinese automaker, leader in the electric vehicle segment, surprised the market by importing more than 100 vehicles to the country in 2024.

This strategy, described as bold by the channel Turbo Formula, aims to avoid the impact of increasing import taxes.

However, is this move the beginning of a new chapter of success or a possible failure in the Brazilian market?

The rise of electric vehicles and the challenges in Brazil

As detailed on the Fórmula Turbo channel, electric cars have been gaining ground in several countries.

In Norway, for example, electric models already represent the majority of sales. In Brazil, however, the reality is quite different.

Only 2% of cars sold in 2023 were electric or hybrid.

Despite this, BYD saw potential and took advantage of tax incentives to establish itself in the country. By 2023, the company dominated around 70% of the electric vehicle market in Brazil.

But in January 2024, the scenario changed dramatically. The Brazilian government reintroduced import taxes, which range from 10% to 25%, and which will continue to rise until reaching 35% in 2026.

This change directly affects vehicle prices and challenges automakers to keep their products competitive.

One hundred thousand vehicles stopped: solution or problem?

Fórmula Turbo explained that, to avoid the new taxes, BYD imported a massive stock of vehicles, enough for two years of sales.

The company saved up to 13% on the cost of each unit, a significant reduction on vehicles that cost around R$200. However, this decision brought new challenges.

Storing such a large volume means tying up capital in a market that is still growing.

Additionally, vehicles parked in yards and ports may suffer from prolonged exposure to the weather, which reduces their market value.

Another issue raised by the channel is consumer perception. Vehicles manufactured in 2024 but sold in 2025 or 2026 may be seen as “old” models, which could devalue the brand.

Insufficient infrastructure: the Achilles heel

The Fórmula Turbo channel also highlighted that the infrastructure for electric vehicles in Brazil is far from ideal.

Currently, the country has only 3 public charging points, most of which are concentrated in large cities such as São Paulo, Rio de Janeiro and Brasília.

Comparatively, China has hundreds of thousands of stations spread across the country.

This inequality directly affects the consumer experience. Drivers who want to travel long distances face difficulties due to the lack of fast chargers on highways.

Furthermore, the few available chargers are often occupied or out of operation, which discourages the use of these vehicles.

Another critical point is the high cost of installing home chargers, which can exceed R$10, in addition to the increase in the electricity bill.

According to Fórmula Turbo, this combination of factors represents a significant obstacle to the popularization of electric vehicles in Brazil.

Nationalization as a solution

In order to get around tax and logistical barriers, BYD has announced plans to nationalize its production.

According to Fórmula Turbo, the company is building a factory in Camaçari, Bahia, with operations expected to begin in the first half of 2025.

Popular models such as Dolphin and Dolphin Mini are among those planned to be manufactured locally.

Nationalization promises to reduce costs, as vehicles manufactured in Brazil will not be subject to import tariffs.

Furthermore, local production can open space for partnerships with Brazilian suppliers, strengthening the production chain.

However, the Fórmula Turbo channel warned that this transition will not be simple. The initial investments are high, and the time needed to consolidate production could delay the company's plans.

During this period, electric vehicles will need to compete with already established and locally manufactured models, which benefit from regional tax incentives.

The future of electric cars in Brazil

Despite the challenges, BYD demonstrates confidence in the Brazilian market. The company relies on awareness campaigns and aggressive pricing to attract consumers.

However, as Fórmula Turbo highlighted, success depends on external factors, such as more favorable public policies, expansion of the charger network and greater acceptance by the public.

In addition, there are technical issues that concern consumers. The durability of batteries, which have a lifespan of 8 to 10 years, is a critical factor.

Replacing them can cost more than R$50, which makes reselling used vehicles unfeasible. Fórmula Turbo emphasized that this problem is aggravated by the rapid technological obsolescence of electric vehicles.

Opportunity or risk?

The electric car market in Brazil is at a crossroads. BYD positions itself as a leader and pioneer, but faces obstacles such as poor infrastructure, high import tariffs and a public that is still adapting.

Does the assembler Will it be able to overcome these barriers and consolidate its success in the country, or will we see a setback similar to that of other markets?

Leave your opinion in the comments: is Brazil ready for the electric vehicle revolution or is there still a long way to go?

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Gilvâni Luis Delmonego
Gilvâni Luis Delmonego
21/01/2025 07:53

It already worked

Marcio
Marcio
21/01/2025 08:36

Biased article by a fake journalist. How embarrassing!

João Renato
João Renato
21/01/2025 08:46

The battery is not Duracell. !!! Hahahaha…products from China, no

worth **** none.

Alisson Ficher

Journalist graduated in 2017 and working in the field since 2015, with six years of experience in print magazines, stints on broadcast TV channels and over 12 online publications. Specialist in politics, jobs, economics, courses, among other topics. Professional registration: 0087134/SP. If you have any questions, want to report an error or suggest a topic on the topics covered on the site, please contact us by email: alisson.hficher@outlook.com. We do not accept resumes!

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