Cars: the interest of Chinese brands to operate in the country is growing

For some time now, there has been talk in the automotive sector about an exclusive topic: are the Chinese coming? The advance of this Asian country is taking place throughout the world and Argentina is no exception.

Although there are already several brands in the country that sell their carsits presence is, for now, symbolic. The participation of all these companies is very low in relation to total sales. They do not reach 1% of general sales.

The situation is different in Brazil, where industrial establishments are already beginning and investments are important, in line with the size of the neighboring country’s market.

In any case, among traditional automotive companies based in the country – those associated with ADEFA – there is concern because, sooner rather than later, they will have to compete with their products. This concern is reasonable because there are more and more indications that Argentina is an attractive target for automotive companies in that country.

In recent weeks, representatives of at least five Chinese brands (of which do not currently sell in the local market) were visiting Argentina.

They came to learn about the economic changes that the president is promoting Javier Milei and know directly the market situation.

“Beyond those who hear from the outside about the economic changes, such as the obstacles to importing that existed and that have now been removed, they want to see with their own eyes the reality of the market,” he told Scope a businessman who had contact with the directors of one of the brands that was on tour.

They were also touring showrooms of competing brands, which are already marketing vehicles in the country, to see the structures they have.

According to this businessman, Chinese brands are quite interested in the local market, although they see an issue with concern.

“What still does not convince them much is the issue of the official policy on electric cars, the lack of incentives that the countries in the region have,” added the businessman.

Until the middle of last year, the import of hybrid and electric vehicles had a tariff benefit. Instead of paying the 35% extra-zone tariff, they paid only 5% and 2% respectively.

This measure had been ordered during the government of Mauricio Macri and was renewed annually with a certain quota for the number of units.

Upon expiration of the annual deadline, in mid-2023, the then minister Sergio Massa It was not renewed and imported cars with this technology began to pay 35%. This implies a tax surcharge that does not allow attractive prices for the internal market.

Currently, it is being considered to replace this tariff benefit, but within an electromobility law that would only be sent to Congress next year.

“China has a problem of overproduction of electric cars. They are very strong in that and all brands have models with that technology. In Europe and the United States they are applying tariff barriers and, for that reason, they are looking to expand in other regions. For this reason, they are interested in seeing what Argentina does,” said another businessman who met with one of the Chinese delegations.

They also saw the limited infrastructure in the country in terms of public chargers as a factor against them, especially taking into account the large national territory.