Chinese truck brands are gaining ground in South America

South America’s commercial vehicle market is becoming increasingly important for Chinese truck brands, but their gains have been uneven in the region. Chinese manufacturers have captured leading positions in the import-led Andes micro-region, but Mercosur’s strong domestic manufacturing base has proven harder to penetrate.

Across South America, commercial vehicle demand remains supported by agricultural, mineral and hydrocarbon exports, which sustain freight volumes and logistics investments. In 2025, the region’s main commercial vehicle markets registered close to 180,000 trucks and 38,000 buses.

More than 70% of that registration volume was concentrated in the Mercosur micro-region, Mercosur comprised of the countries of Argentina, Brazil, Paraguay and Uruguay, with Brazil’s truck market alone accounting for roughly 60% of regional registrations.

South America is also a major commercial vehicle producer, with nearly 80% of vehicles assembled locally. Those figures, however, mask two very different market structures. Regionally assembled commercial vehicles accounted for more than 98% of the Mercosur market, compared with just 30% in the Andes.

These differences have created very different paths to growth for Chinese truck brands across South America, as illustrated in the following chart of South America truck and bus registrations (>6t GVW, thousands).

How Chinese truck brands gained ground in the Andes

The Andes offered Chinese truck manufacturers a relatively open market with little domestic commercial vehicle production. Its main markets—Chile, Colombia, Ecuador and Peru—registered nearly 50,000 medium- and heavy-duty trucks in 2025. Colombia is the only country in the region with a history of domestic manufacturing, and its volumes remain limited.

This small production footprint has resulted in low import barriers and a diverse brand ecosystem, especially among Asian manufacturers. The micro-region also skews toward medium-duty trucks, although Chile’s developed highway network and mining industry support greater demand for heavy-duty vehicles, reflected in the following chart on the Andean truck mix per segment.

Medium-duty demand was historically led by Japanese and Korean brands such as Isuzu, Hino, Hyundai and Mitsubishi Fuso, while European and North American brands dominated the heavy-duty segment. Chinese truck manufacturers entered with comparable, competitively priced medium-duty products and tapped established importer groups with existing dealership and service networks.

Regulatory changes and disruption created further opportunities for Chinese commercial vehicles. Euro VI was adopted by Colombia in 2023 and Chile in January 2026, while Ecuador and Peru remain at Euro IV. Chinese OEMs supplied products across these standards and quickly capitalized on the disruption caused by Hino’s 2022 emissions-certification issues.

The result was rapid growth. Mainland Chinese share of medium-duty trucks in the Andes rose from 27% in 2020 to 42% in 2025, overtaking Japanese and Korean brands. In heavy-duty trucks, Mainland China’s share increased from 16% to 38%, largely at the expense of North American, Japanese and Korean OEMs, while European share held at around 44%.

Chinese truck brands expanded their portfolios with higher-performing products and alternative fuels such as natural gas, while rising heavy-duty truck prices also pushed buyers away from traditional brands. European OEMs, however, retained the premium heavy-duty segment, where fleets place greater weight on uptime, service coverage, financing and resale value than on acquisition price alone.

Chinese OEMs’ combination of competitively priced trucks, new technologies, alternative fuels and decentralized dealer and parts networks has paid dividends. Their share of the total medium and heavy commercial vehicle market in the Andes rose from about 21% of the market in 2020 to more than 39% in 2025, overtaking European brands as the region’s top choice, with the chart below showing Andean truck registration per brand origin.

Looking ahead, the pace of growth is likely to moderate, with some consolidation among the more than 15 Chinese truck brands operating in the Andes. Whether these OEMs can break into the premium heavy-duty segment remains an open question, with resale value a key concern.

Why Chinese truck brands face a tougher road in Mercosur

Mercosur offers Chinese truck brands a much larger but more difficult market to enter. Its two largest markets, Argentina and Brazil, account for more than 60% of South America’s population and the bulk of its industrial and agricultural output. The region registered nearly 127,000 medium and heavy commercial vehicles in 2025, far more than the Andes.

Mercosur is also a major commercial vehicle manufacturing hub. Brazil ranks in the top 5 of global commercial vehicle producers, while Argentina has considerably expanded its manufacturing base.

European brands have assembled commercial vehicles in Mercosur since the 1950s, creating significant barriers for vehicles produced outside the bloc. Imports face higher tariffs, while subsidized financing requires minimum levels of local content. Paraguay and Uruguay are more import-friendly, but they represent less than 2% of Mercosur commercial vehicle registrations.

Mercosur’s vast highway network and high volumes of bulk commodities also make it a heavy-truck-centric market: more than 80% of trucks over six tons are heavy-duty, as illustrated in the chart below showing Mercosur truck registration by segmentation.

Mercosur’s domestic manufacturing base, import barriers and heavy-truck orientation make the import-led model that fueled Chinese truck brands’ growth in the Andes uncompetitive outside of niche segments.

Mercosur’s vast geography creates another challenge for newcomers: developing an effective dealership and spare parts network is complex, while establishing local assembly and supply chains requires substantial investment in an often-volatile market.

Earlier Brazilian entries by Shacman and Sinotruk illustrate this risk. Weak parts support and the 2012 market downturn undermined their localization plans, and their eventual departure damaged operator confidence and reinforced concerns over long-term support and resale value.

European OEMs have an even greater advantage in Mercosur’s premium segment than in the Andes, thanks to established service networks, captive financing and access to subsidized credit tied to local content. New entrants must also compete with a deep used-truck market, where smaller operators often prefer familiar models with predictable resale values to new trucks from unproven brands.

More recently, however, JAC Motors and Foton have been carving out niches in the medium-duty segment by emphasizing local operations. JAC Motors has established a modest position in BEV trucks through a third party and plans to introduce a locally assembled diesel range without an intermediary—and with dealerships in place ahead of the launch. Foton has focused on Class 5 and 6 trucks assembled in Argentina and Brazil while investing in its dealer and parts network.

As a result, Mainland Chinese market share in the medium-duty segment in Mercosur has risen from 1.7% of registrations in 2020 to 6.8% in 2025. While still far below their share in the Andes, this growth suggests that localization and investments in dealer networks are beginning to pay off.

Chinese truck brands have made less headway in the heavy-duty segment, with their registration share rising from 0.1% in 2020 to 1% in 2025, driven largely by Foton’s operations in Argentina. Registration volumes by brand origin are shown in the following chart.

Growth is unlikely to approach the pace seen in the Andes, but Chinese truck manufacturers are laying the groundwork for further gains. Dongfeng Trucks, for example, has announced plans to enter Brazil, while SANY Trucks is building local operations there.

What comes next for Chinese commercial vehicles in the South American truck market

Chinese truck brands have adapted to South America’s distinct commercial vehicle markets, relying on importers in the Andes while pursuing a slower localization strategy in Mercosur. The next test in both regions is the premium heavy-duty segment, where they have yet to replicate their success in medium-duty trucks.