The recent decision by the Government to allow the tariff-free importation of up to 50,000 hybrid and electric vehicles per year marks a new chapter for Argentina’s automotive market.
The measure represents a strategic shift in trade policy, allowing the entry of vehicles from outside the Mercosur bloc —mainly from China and Europe— that were previously restricted under the economic cooperation agreement with Brazil (AC14).
“Until 2029, it was not possible to import vehicles from outside the Mercosur zone,” highlights Hugo Belcastro, President of the Chamber of Official Importers and Distributors of Motor Vehicles (CIDOA), during a Ahora Play live stream with journalist Maximiliano Montenegro.
“That, in some way, handed the market over to Brazil: nine out of ten imported cars came from there,” he explains.
The appearance of a legal mechanism to allow the entry of electrified vehicles not listed in AC14 has been key to unlocking the tariff exemption quota. According to Belcastro, the measure responds to a structural need:
“One of the reasons that prompted the Government to take this step is the lack of competition.”
An opportunity that accelerates the growth of electrified vehicles
The potential impact of this policy is already becoming evident.
For the first quarter of 2025, a 70% increase in imports is projected compared to the same period in 2024, with expectations to close the year at 600,000 vehicle registrations, including both electrified and internal combustion units. This volume is expected to introduce competitive pressure and support the modernisation of the national fleet.
“Some 31,000 import requests for electric vehicles have already been submitted, covering different brands, which will likely bring in mostly hybrid cars,” Belcastro notes.
He explains that due to logistical factors —such as production and shipping timelines— the first models will begin arriving from July, with hybrids taking precedence due to infrastructure limitations for fully electric vehicles.
The trend was already on the rise. In 2024, Argentina doubled its sales of electrified vehicles, with a 48% year-on-year growth, reaching 14,175 registered units, of which 86% were non-plug-in hybrids.
Read more: Argentina “simplifies procedures” to allow individuals to import vehicles – What does this mean for EVs?
China and Europe, key players in the new competitive landscape
The new entrants to the Argentine market are not only arriving without tariffs, but also with features that make them particularly appealing.
“China offers the best value for money,” asserts Belcastro, while acknowledging that “European vehicles are more expensive, but will also enter with less than 16% in tariffs.”
With increasingly competitive logistics costs, Belcastro notes that “a sea freight shipment now costs 1,500 dollars,” allowing a final consumer price of around $32,000 for some models —including five-star safety packages, advanced technology and low maintenance costs.
“The good thing is that, once people see 50,000 vehicles on the streets from manufacturers like China, Japan or Germany, they’ll want those cars,” Belcastro reflects.
He does not rule out the possibility of this policy being expanded: “This year it was a quota, but I imagine it’s likely to be increased or fully liberalised. That’s when the competition will get serious,” he projects.
Infrastructure in transition, but with signs of progress
Despite import incentives, the development of charging infrastructure remains a limiting factor. “Since there isn’t a large network of chargers, fully electric vehicles will take much longer to enter the country,” warns Belcastro.
However, he sees ongoing progress: “Charging points already exist in various parts of Argentina. In a year, we’ll have many more options and two or three consolidated alternatives,” he anticipates.
From a cost perspective, the scenario also appears favourable.
“If it costs 70,000 pesos to fill a fuel tank versus 10,000 pesos to charge an EV, and when you add the very low maintenance costs and exemption from vehicle tax, it becomes much more attractive to the consumer,” argues the CIDOA head.
Industrial perspective and regional outlook
Belcastro also raises the structural dilemma between openness and industrial protection.
“We must protect local production, but also guarantee competitive prices for consumers,” he insists. He also emphasises that “the true automotive industry lies in auto parts,” and advocates for moving towards greater local integration that goes beyond assembly using imported components.
In terms of the regional context, he highlights the impact of US tariff policies on global trade.
“Today we think that Argentina imposes a 35% tariff, while the tariffs Trump imposed on cars not manufactured in the US are 25%, which is much lower than what Argentina has historically charged,” he notes. This situation —he explains— could lead to an oversupply of vehicles from Mexico to alternative markets, increasing competitive pressure in South America.
Finally, Belcastro reflects on the global reshuffling of brands in a transforming market: “In this competitive game, some rise and others fall. Tesla lost value, but brands like Toyota, VW and BYD are gaining ground around the world,” he concludes.
