Chilean truck driver Claudio Perez’s skepticism about purchasing a Chinese-made car quickly dissipated two years ago when he decided to take the plunge. Despite initial doubts, the affordable price and efficient delivery of the vehicle won him over. This sentiment is mirrored by many car buyers across Latin America who have shifted their preference from US- and Brazilian-built cars to Chinese models in recent years.
The Chinese automotive industry has seen exponential growth in the Latin American market, with sales skyrocketing from $2.2 billion in 2019 to $8.5 billion in 2020. Chinese cars now account for 20 percent of the region’s total car sales in terms of value, surpassing the United States and Brazil at 17 percent and 11 percent, respectively. This surge in popularity can be attributed to Chinese carmakers’ commitment to offering competitive pricing without compromising on quality.
Chinese car manufacturers have established a strong foothold in the Latin American electric vehicle market, capturing 51 percent of all sales. Notably, the majority of electric buses operating in the region are of Chinese origin. The emphasis on innovation, technology, and design has propelled Chinese electric vehicles to the forefront of the automotive industry in Latin America.
Unlike the United States and Europe, where protective import tariffs hinder Chinese car sales, Latin America has welcomed Chinese manufacturers with open arms. Countries like Chile, Mexico, and Brazil have witnessed a surge in Chinese car sales, with models capturing nearly 30 percent of the market in Chile alone. In Brazil, Chinese giant BYD is set to commence operations at its largest electric car plant outside of Asia, signaling further expansion.
The affordability of Chinese cars has democratized car ownership for middle- and low-income populations in Latin America. This accessibility has paved the way for cleaner engine technologies to combat pollution in major cities like Santiago, Bogota, and Mexico City. Economist Sebastian Herreros emphasizes the importance of adopting electro-mobility as a means of ensuring environmental sustainability and public health.
The rise of Chinese cars in Latin America marks a significant shift in the automotive industry, with Chinese manufacturers challenging traditional automotive powerhouses in the region. As consumers continue to prioritize affordability, innovation, and sustainability, Chinese cars are likely to maintain their stronghold in the Latin American market. The influx of Chinese vehicles not only reflects changing consumer preferences but also underscores the transformative impact of Chinese automotive technology on the region.