Volkswagen has announced that the stock of imported cars in Brazil now exceeds that of local models, with 210,500 imported vehicles waiting for buyers compared to 148,800 domestic cars as of January 2026. Ciro Possobom, CEO of Volkswagen Brazil, noted that approximately 80% of these imported cars are sourced from China, highlighting a significant shift in consumer preference towards foreign vehicles. This trend raises questions about the competitiveness of domestic manufacturers and their ability to adapt to evolving market conditions.

In a critical view of the assembly systems employed by competitors, such as BYD's SKD (semi knocked down) and CKD (completely knocked down) processes, Possobom emphasized the importance of local production. He argued that Volkswagen's operations in Brazil involve the movement of 26,000 tons of steel, a process that is compromised when vehicles are imported in disassembled forms. This statement underscores a broader concern regarding the sustainability of local automotive industries and the potential job impacts resulting from increased imports.

Additionally, the company is grappling with challenges posed by the ongoing conflict in the Middle East, which has affected global supply chains and the distribution flow of essential automotive parts. Volkswagen is currently assessing its logistics to determine whether it will need to shift towards more air transportation methods, which could imply increased costs and strategic adjustments in their supply chain management. This situation illustrates the vulnerabilities faced by international businesses in maintaining stable operations amidst geopolitical tensions and global market fluctuations.