Brazil’s government is facing mounting pressure as it decides on a request from Chinese carmaker BYD to reduce import tariffs for a year on semi-assembled electric and hybrid vehicles.
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The proposal, now under review by the Chamber of Foreign Trade, or Camex, has sparked a wave of opposition from global carmakers and regional governors who warn it could undermine Brazil’s industrial base and lead to job losses.
The Camex panel, which was meeting on Wednesday, was expected to render a decision shortly.
BYD seeks a 10 per cent tariff on imports of partly assembled vehicles, known in the industry as SKD kits, until July 2026. Tariffs on such imports are 18 to 20 per cent.
The Chinese company, a global leader in the manufacture of electric vehicles, said it needs the lower rates for a transition period while its factory in Camaçari, Bahia State, becomes fully operational. The goal is to reach 70 per cent local content by 2028, per a contract signed with the local government.
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The company’s request includes an annual import quota exceeding US$2 billion, more than double BYD’s announced investment of R$5.5 billion (US$978 million). That figure also represents nearly 60 per cent of the five-year federal budget for the government’s Mover programme, aimed at stimulating the production of cleaner hybrid combustion vehicles.
