The Brazilian Federal Government released a list on August 12th, which includes 16 automobile manufacturers authorized to import hybrid, plug-in hybrid, and electric vehicles with zero tariffs (in completely knocked down or semi-knocked down form) for a period of 6 months. The set maximum total import exemption limit is $463 million. This measure is regulated by Regulation No. 420/2025 of the Foreign Trade Secretariat for 2025 (Portaria Secex nº 420/2025).

According to the standards of the Ministry of Development, Industry, Trade, and Services (MDIC) of Brazil, this import quota will be shared among all approved manufacturers. Among these 16 manufacturers, 9 already have factories in Brazil or have plans to establish factories in the near future, including Chinese companies like BYD, Great Wall, and Chery.

CKD (Completely Knocked Down): where vehicles are completely disassembled into parts upon arrival in Brazil and then reassembled locally.
SKD (Semi Knocked Down): where vehicles are partially assembled before being shipped to Brazil and then undergo simplified local assembly.
This operational method is commonly used by automobile manufacturers to reduce import taxes and facilitate the entry of imported vehicles into the Brazilian market.

Although this practice is legal, it has also drawn criticism from some automakers who believe that this method neither creates a large number of job opportunities nor promotes the development of the domestic industry. Since most components come directly from abroad, the assembly process requires less labor and has minimal collaboration with local Brazilian component suppliers. In many cases, these factories resemble simple assembly lines, lacking the potential to add value to the products and failing to bring technological innovation.

For some members of the Brazilian industrial sector, this model deviates from the country's policy of reindustrialization, which aims to attract more investment, create high-quality jobs, and strengthen Brazil's automotive industry chain.