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Toyota’s engine manufacturing plant in Porto Feliz (SP), Brazil, will not resume full production until 2028 after suffering severe structural damage caused by a storm in September 2025. The facility, responsible for producing flex-fuel ICE engines for models such as Corolla, Corolla Cross and Yaris, was heavily damaged, requiring complete reconstruction. Only the original foundation slab will be reused, with a new industrial building designed to incorporate higher levels of automation and a more compact manufacturing layout.
During the reconstruction period, Toyota implemented contingency measures, including the installation of a temporary structure in Porto Feliz to maintain partial engine production. Part of the workforce was reassigned to the Sorocaba plant, while other employees entered temporary layoff programs. The company plans to test a new productivity and manufacturing concept by the end of 2027, with full operational normalization scheduled for 2028.
The Federal National Education Development Fund (FNDE), part of Brazil’s Ministry of Education, has revoked the public tender for the purchase of approximately 7,500 school buses under the Programa Caminho da Escola scheduled for 2026. The cancellation was formally published in early February 2026 to align the procurement with a new law on tax exemptions, which altered fiscal conditions for vehicles eligible in the program.
Brazil’s truck market started 2026 in significant decline. A total of 6,379 units were registered in January, representing a drop of approximately 30% compared to January 2025 (9,131 units) and a 34% decrease versus December 2025 (9,765 units), according to data from Fenabrave (National Federation of Motor Vehicle Distribution).
Market leadership in the month was shared by Volkswagen Caminhões e Ônibus and Mercedes-Benz, each holding around 27% market share. They were followed by Volvo, Scania, Iveco, DAF and Foton.
In January 2026, the Brazilian federal government launched the Move Brazil Program, a credit support initiative totaling approximately USD 2.0 billion. The program aims to support the domestic truck manufacturing industry and stimulate fleet renewal amid a sharp downturn in heavy-duty vehicle demand.
Financing will be provided through BNDES with annual interest rates between 13% and 14%, grace periods of up to six months, and repayment terms of up to five years, capped at approximately USD 10 million per beneficiary. Eligible beneficiaries include independent truck drivers, cooperatives, transport companies, and large fleet operators, with 10% of total funding reserved for independents and cooperatives.
Financing is restricted to new trucks manufactured in Brazil and compliant with Proconve P8 emission standards, as well as used trucks (model year 2012 onward) meeting Proconve P7 requirements and local content criteria. The program will be available for six months and is positioned as a short-term measure to mitigate layoffs and production cuts in the heavy truck segment.
Brazil’s vehicle distribution association Fenabrave projects that the total new vehicle market in 2026 will grow by approximately 3%, reaching around 2.7–2.8 million units in total sales across all segments compared with 2025 performance. This projection includes ~3% increases in passenger cars and light commercial vehicles, roughly 2.6–2.7 million units, and ~3.5% growth in truck registrations. Sales of buses are also forecast to rise ~3%.
The outlook is supported by expectations of improved credit availability, federal support programs such as Carro Sustentável and Move Brazil, and a strong commodities export environment, which bolsters freight demand. The heavy truck segment, which faced a steep decline in 2025, is expected to contribute to overall market expansion. Fenabrave’s forecast assumes modest macroeconomic improvement and continued easing of credit conditions.
Eletra announced an investment of BRL 40 million (approximately US$ 7 million) to expand its factory in São Bernardo do Campo (SP) and build a new in-house chassis assembly line. The initiative will transform Eletra into a full-fledged chassis manufacturer, rather than relying solely on chassis supplied by partners.
Yanmar announced an investment of US$ 50 million, to build a manufacturing plant in Indaiatuba, São Paulo. The facility will occupy 140,000 square meters — triple the area of the current unit — with phased implementation through 2030; the first 36,000 square meter unit is planned to begin operations in 2027.
With this expansion, the company expects to increase annual tractor production from 5,000 to 7,000 units, centralize industrial, administrative and logistics operations, deploy automated assembly lines with torque control, streamline logistics, and integrate sustainability measures such as natural lighting, photovoltaic energy and automated lighting. The project should generate around 100 direct and indirect jobs by 2029.
Volvo CE has introduced in Brazil the latest generation of its largest articulated dump truck, the A60. The updated model offers a payload capacity of 55 000 kg and a dump body volume of 33.6 cubic meters — the highest among articulated haulers available locally. It is powered by the Volvo D16J engine, delivering 470 kW (≈ 630 hp) and 2,960 Nm torque, optimized for heavy off-road operations.
Compared with the previous generation, the A60 delivers a 15% gain in fuel efficiency and 5% increase in productivity per loading cycle. The redesign includes improvements in drivetrain, transmission, traction control and operator ergonomics, reflecting Volvo’s renewed lineup update for articulated trucks in Brazil.
PSR Analysis:The upgraded A60 meets rising demand from mining, quarrying and large-scale infrastructure sectors by combining high payload, improved fuel economy and proven off-road capability, translating into lower operating cost per ton transported. Its enhanced drivetrain, traction control and stability — crucial in challenging terrain — should increase uptime and reliability for high-utilization fleets. PSR
Fabio Ferraresi is Director, Business Development, South America, for Power Systems Research
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.
Stellantis has begun exporting the Brazil-made Ram Rampage to Europe, marking the first Ram vehicle developed and manufactured outside North America to reach the continent.
