Brazil and Colombia have agreed to extend for 12 months the bilateral automotive quota allowing duty-free export of up to 50,000 Brazilian vehicles per year. The mechanism, which had expired in September, risked reinstating a 16.1% import tariff on Brazilian ICE and flex-fuel passenger vehicles entering the Colombian market from 2025 onward. From January to September 2024, Colombia remained Brazil’s third-largest automotive export destination, receiving 38,500 units (+55.2% YoY), below but close to the annual quota.
Source: Autodata Read The Article
PSR Analysis. The quota renewal preserves short-term market access for Brazilian OEMs, avoiding a steep tariff shock that would reduce competitiveness in Colombia’s price-sensitive segment. The agreement also buys time for both countries to renegotiate structural terms of the automotive pact, including tariff schedules, local content rules and potential alignment with broader regional industrial policies. The 50,000-unit ceiling remains modest relative to Brazil’s export capacity, signaling that future gains depend on deeper regulatory harmonization and Colombia’s internal demand recovery. Maintaining preferential access is strategically relevant as Brazil seeks to sustain export volumes amid domestic overcapacity and uneven Latin American markets. PSR
Fabio Ferraresi, is Director, Business Development, South America, for Power Systems Research
