Electric Vehicles in Latin America - Statistics & Facts
The global electric vehicle market has been booming since 2018, boosted by increased consumer interest in sustainable mobility and governmental incentives in various countries across the globe. The COVID-19 pandemic further contributed to the market’s significant growth as buyers sought socially distanced commuting alternatives, and their awareness of the negative impact of gas emissions rose. The transport sector accounted for 17 percent of the global greenhouse gas emissions in 2018, making it the second-largest polluter behind the electricity and heat sector. Transport emissions were high in Latin America, home to nearly one-fifth of the global oil reserves—Brazil reported over 201 million metric tons of transport emissions in 2019, followed by Mexico at 151.78 million metric tons. In this context, the impetus for Latin America to develop its electric vehicle fleet is increasing, but the EV market is still emerging in the region. In 2021, the EV market size in South America was around 1.1 billion U.S. dollars, and forecasts estimate it will have a compound annual growth rate of some 14 percent between 2020 and 2026.
The state of the electric vehicle market is intrinsically linked to national incentives to propel it further. Brazil reported the region’s most significant renewable energy capacity at just under 160,000 megawatts in 2021. However, most of its electric vehicle sales were hybrid electric vehicles—primarily powered by their internal combustion engine—as the government faced pressure from lobbies against its 2018 Rota 2030 policy to stop ICE vehicle sales by 2030. Mexico, boasting the largest plug-in electric vehicle market in Latin America at over 4,600 sales of plug-in hybrid and battery-electric vehicles, offered varying private EV incentives depending on each Mexican state. It also reported the largest regional electric vehicle charging station network in 2021. In Colombia, the regional leader in the sale of battery-electric vehicles (BEVs), financial incentives—such as lower taxes on EV imports and preferential parking—detailed in a 2019 law have promoted EV sales. The same can be observed in Costa Rica, where tax cuts for buyers described in a 2018 law have encouraged BEV sales.
The global electric vehicle giant Tesla does not record the same popularity in the region. This is partly due to a late entry in parts of the Latin American market impacted by the pandemic and the lack of infrastructure for Tesla-branded vehicles.
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Research Expert covering transportation and logistics