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Brazil Vehicle Exports Rise To Mexico, Fall To Argentina

Fabio Ferraresi Brazilian vehicle exports showed mixed performance in early 2026, increasing significantly to Mexico while declining sharply to Argentina. Growth in shipments to Mexico reflects stronger demand conditions and efforts by Brazilian OEMs to diversify export destinations, while the drop in Argentina is linked to weaker domestic demand, tighter import controls and foreign exchange constraints.
Overall exports remained supported by regional demand adjustments and production planning by automakers,…
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Brazil Truck Production Drops in 2026 First Two months
Brazilian truck production fell 27% in the first two months of 2026 compared with the same period of 2025, despite expectations linked to the Mover Brazil program. The decline reflects weaker domestic demand, cautious fleet renewal decisions and slower freight activity at the start of the year.
OEMs adjusted output in response to lower order intake, particularly in the heavy duty segment. The result highlights ongoing volatility in Brazil’s commercial vehicle cycle and limited short term impact of policy support measures on production levels.
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VW Tukan Is Brand’s First Flex Hybrid Vehicle
Volkswagen confirmed that the upcoming Tukan compact SUV will be its first flex fuel hybrid vehicle developed for Brazil. The model will combine a hybrid powertrain with a flex fuel ICE capable of running on gasoline and ethanol, aligned with local decarbonization strategies and Brazil’s biofuel infrastructure.
The vehicle is expected to be produced locally and positioned in the compact SUV segment, supporting Volkswagen’s regional electrification roadmap. The launch reinforces the company’s focus on hybridization technologies adapted to Brazilian market conditions and regulatory trends.
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Q4 2025 Truck Production Climbs 3.7%
The Power Systems Research Truck Production Index (PSR-TPI) increased from 107 to 111, or 3.7%, for the three-month period ended Dec. 31, 2025, from Q3 2025. The year over-year (Q4 2024 to Q4 2025) loss for the PSR-TPI was, 113 to 111, or -1.8%.
The PSR-TPI measures truck production globally and across six regions: North America, China, Europe, South America, Japan & Korea and Emerging Markets. This data comes from OE Link,™, the proprietary database maintained by Power Systems Research.
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Hidden Cost of Europe’s Hydrogen Bus Experiment
This Clean Technica article notes, “Arthur Bus’s collapse in Poland marks the end of a story that had been quietly unraveling for some time. A hydrogen bus startup backed by public funding, municipal orders, and a planned manufacturing footprint failed before delivering a single customer vehicle.
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Tesla Semi Lines Up for $165M in California Incentives

Chris Fisher The update was initially reported by The Los Angeles Times.
Tesla reportedly is positioned to receive roughly $165 million in California clean-truck incentives for its Semi.
As per the Times, the Tesla Semi’s funding will come from California’s Hybrid and Zero-Emission Truck and Bus Incentive Project (HVIP), which was designed to accelerate the adoption of cleaner medium- and heavy-duty vehicles. Since its launch in 2009, the HVIP has distributed more than $1.6 billion to support zero-emission trucks and buses across the state.
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Toyota Engine Plant To Resume Production in 2028

Fabio Ferraresi 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.
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Brazil Suspends 2026 School Bus Procurement
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.
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Brazil 2026 Truck Sales Drop Sharply in January
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.
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2026 Growth of 4.9% Seen in Truck Production

Chris Fisher Medium and heavy truck production in North America is expected to increase by 4.9% this year compared with 2025. While class 8 truck production is expected to increase by 6.1% this year, the industry continues to be negatively impacted by the weight of the tariffs, low freight demand, excess truck capacity and relatively high finance rates which is expected to continue through at least the first half of the year.
With regard to the implementation of the phase 3 GHG emission regulations, it will be later in the spring before the EPA finalizes any revisions to the standards. Many in the industry believe the EPA will retain the 0.035 g/hp-hr standard along with the 2027 implementation date but cancel the extended warranty requirements which would have added significant up-front cost to the trucks.
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