Chinese investment in Brazil’s EV and electricity sector soars, says report

All Chinese projects in the Brazilian automotive industry are aimed at manufacturing electrified vehicles

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Great Wall Motors has expanded its operations in Brazil, focusing on the production of electric and hybrid vehicles. Photo: Xinhua

Published: 5:48am, 4 Sep 2024

Chinese investment in Brazil grew by 33 per cent in 2023, reaching US$1.73 billion, according to a study by the Brazil-China Business Council (CBBC) released on Tuesday.

Although the number of confirmed Chinese projects in the country fell from 32 in 2022 to 29 in 2023, it was still the third largest total since 2007. Most of the financing went to the electricity sector, which accounted for 39 per cent of the total investment amount, equivalent to US$668 million. These investments focused on renewable energy sources such as wind, solar and hydropower.

The highlight was electric vehicles. According to CBBC, Chinese investment in the automotive sector increased by 56 per cent compared with 2022, reaching US$568 million.

Since 2021, all Chinese projects in the Brazilian automotive sector have been aimed at manufacturing electrified vehicles. Companies such as Great Wall Motors (GWM) and BYD have expanded their operations in Brazil, focusing on the production of electric and hybrid vehicles.

Tulio Cariello, research director at CBBC, said the entry of EV companies into the Brazilian market was not new – BYD, for example, has been manufacturing electric buses in the state of São Paulo – but the establishment of factories to produce vehicles for the end consumer represented an increase in the overall investment share.

“Both BYD, which took over the former Ford factory, and GWM, which acquired a Mercedes factory, have a clear desire to invest for the long term. And these are very significant amounts of capital,” Cariello said.