By Alessandro Parodi and Victoria Waldersee
(Reuters) – the largest car – carrier in the world – with the equivalent of 20 football fields of vehicles – completed his first trip at the end of last month to moor in the Itajai port of Brazil.
But not everyone welcomes his arrival.
BYD, the top producer of China of electric and plug-in hybrid vehicles, offers Brazilian car workers relatively cheap options in a market where the green car movement is still in its infancy. Brazilian car industry officials and workers are concerned that the enormous inflow of cars from BYD and other Chinese car manufacturers will reduce domestic car production and harm jobs.
BYD has used a growing fleet of cargo ships to accelerate its expansion abroad, with Brazil, according to Reuters analysis of shipping data and business declarations. The shipping of the late May was the fourth of the ships of the Chinese car manufacturer to this year in Brazil in Dok, a total of around 22,000 vehicles, according to Reuters calculations.
BYD, the world's top producer of electric and plug-in hybrid cars, is the largest among different Chinese brands that focus on Brazil for growth. The vehicle entry built in China is expected to grow nearly 40% this year to around 200,000, according to the most important car association of Brazil. That would represent about 8% of the total registrations of the light vehicle.
Industrial and labor groups say that China uses the temporarily low rate barriers of Brazil to increase its export instead of investing to build Brazilian factories and create jobs. They lobby the Brazilian government to accelerate a plan for a year to increase the rate of Brazil on all EV imports to 35% of 10%, instead of gradually phasing in higher levies.
“Countries around the world began to close their doors for the Chinese, but Brazil did not do that,” said Aroaldo da Silva, a production employee of Mercedes-Benz and President of Industriall Brasil, a confederation of trade unions in six industrial sectors. “China used it.”
BYD did not respond to a request for comments on the care of the industry.
Excess cars
Brazil has emerged as a flash point in the scorching global expansion of the Chinese car industry. A growing surplus of new cars that are pumped from the Chinese factories has led to an export tree over the past five years, as a result of which China Japan helped to be in 2023 in 2023 to become the world's top vehicles exporter. Much of this excess is sent abroad, to markets such as Europe, Southeast Asia and Latin -America.
Brazil offers a seductive destination because of the Grote Markt – it is the sixth largest car market per volume – where established players, including Volkswagen, General Motors and Jeep -Maker Stellantis, have been building cars for decades. The Brazilian government has established policy that is aimed at the growing sale of electric and plug-in hybrid cars, the specialty of BYD.
In the meantime, BYD's path for growth has been reduced elsewhere, both in its own country and abroad. At home, the company is entangled in bruises that has reduced the price of its entry level to less than $ 10,000, with the profit margins being pressed.
Abroad, governments have set up stiff trade barriers for Chinese cars, including a duty of 45.3% in Europe and a rate of more than 100% in the United States, along with a ban on Chinese software in cars.
For years, Brazilian officials have taken measures to protect the market against unobstructed access by Chinese car companies. But it has been slower to respond and less aggressive than other countries.
In 2015, Brazil eliminated the rates for manufacturers such as BYD to stimulate the acceptance of electric vehicles, but last year it introduced a 10% rate on electric cars to encourage investments in the domestic car industry. The rate will rise every six months before it affects 35% in 2026.
The Brazilian Ministry of Development, Industry and Foreign Trade told Reuters that a request from the Brazilian car Association, Anfavea and others to continue the higher rate was assessed.
“The schedule for the gradual resumption of the rates, with falling quotas, was established to enable companies to continue with their development plans and to respect the duration of production in the country,” added a spokesperson for the ministry.
BYD and other Chinese companies also benefit from a policy in Brazil with which they can import up to $ 169 million for free for plug-in hybrids imported by July 2025 and $ 226 million for battery-electric cars. This encourages loading of vehicle shipments to fully benefit from the free quota before they end, analysts said.
'Excess of Import'
The Export strategy of BYD depends on the car manufacturer that is able to continue to grow shipments without activating the local authorities. But representatives in the industry in Brazil have become more and more worries that the plans of BYD to start domestic vehicle production are deposited.
In 2023, government officials encouraged BYD to buy a former Ford factory in the state of Bahia, to consider it a way to create production tracks and to stimulate the green transition of the country. But an investigation into the abuse of labor on the construction site pushed its timeline back for “fully functional” production until December 2026, local officials said in May.
Another Chinese automaker, GWM, also with more than a year delayed his plan to make cars in a former Mercedes-Benz factory. The Brazilian government expects the factory to start operating this year.
“We support the arrival of new brands in Brazil to produce the sector, to promote the componence sector, create jobs and bring new technologies,” Igor Calvet, president of Anfavea, told Reuters. “But from the moment that an excess of importing lower investments in production in Brazil causes, that worries us.”
Da Silva van Industriall said that his confederation of trade unions had never heard of the development of local supplier relationships or contracts signed for the BYD factory, as normally 18 months from the start of production would be expected.
“Even if the factory is here – what value is it really adding if the components, development and technology all come from abroad?” Da Silva said.
BYD did not respond to a request for comments on its supplier network.
The left -wing employees of President Lula da Silva Klautert to protect jobs and the environment, since both the industrial economy of Brazil breathe new life and restoring its green references prior to organizing the COP30 Global Climate Summit in November.
Nevertheless, the emerging green-car movement of the country leans on Chinese import, which, according to the Brazil's EV association, ABVE, are good more than 80% of the sale of Brazil from Brazil.
The country has abundant mineral agents, including lithium and other important ingredients to make EV batteries. But the infrastructure to produce all the necessary components for electric cars does not yet exist, said Ricardo Bastos, director of government relationships at GWM Brazil and President of Abve.
GWM, which bought a factory in Brazil in 2021 with capacity for 50,000 cars a year and will produce its Haval H6 SUV there in July, is in conversation with around 100 suppliers established in Brazil about setting up contracts, Bastos told Reuters.
“This year, imported cars will exist in addition to cars produced in Brazil,” said Bastos.
(Reporting by Victoria Waldersee in Berlin and Alessandro Parodi in Gdansk; Additional reporting by Fabio Teixeira in Rio de Janeiro; Editing by Mike Colias and Michael Leardh)
