This article first appeared on GuruFocus.
Uruguay might be one of the smallest markets in Latin America, but its EV shift is starting to look like a real narrative. Battery-powered vehicles made up about a quarter of all new car and SUV sales through October, more than double last year’s share, helped by zero import duty on EVs, excise-tax exemptions and gasoline sitting at roughly $7.40 per gallon. This mix is pulling buyers toward Chinese brands in a region long defined by American, European and Japanese players. Analysts at BloombergNEF suggest the broader Latin American market could be heading toward more than 400,000 battery electric and plug-in hybrid sales this year, with the arrival of cheaper Chinese models possibly driving the jump from about 2% in 2023 to more than 8% in 2025.
Inside Uruguay, the competitive landscape is shifting even faster. About 90% of the roughly 11,000 battery EVs sold this year came from Chinese brands such as BYD (BYDDF), JAC and Omoda, with BYD’s Seagull priced just under $20,000 and its Yuan Pro drawing buyers who estimate savings of as much as $400 per month by charging at home. These economics could be why some households are now mixing EVs with gasoline vehicles for longer routes, as owners cite convenience in Montevideo but uncertainty about cross-border travel to Argentina or Brazil. BloombergNEF’s Rafael Rabioglio said affordable Chinese models were possibly a game changer for the region’s price-sensitive consumers, suggesting the shift may not have emerged this quickly without them.
Even premium buyers are leaning electric. Tesla (NASDAQ:TSLA) has no official presence in Uruguay, yet dealers have sold 152 units since 2020, outpacing markets with far larger populations. One importer near Punta del Este sold about 40 Teslas this year and expects at least 60 next year as buyers spend around $60,000 for a Model 3. Owners praise low operating costs sometimes around 500 pesos per month and software updates that keep the vehicles feeling current. Some Uruguayans are even bringing Teslas home duty-free after living abroad, adding to a growing community of owners who trade upkeep tips and source parts through specialized repair shops. If Uruguay keeps combining high fuel prices with generous tax incentives and a growing charging network, the country could be giving investors an early look at how small, wealthy markets adopt EVs long before any local manufacturing emerges.
