Skip to content

Automotive in Brazil Customer Challenges and Pains Analysis

Challenges and Pains faced by Customers

Customers in the Brazilian automotive value chain, encompassing both B2B and B2C segments, face a range of significant challenges and pains throughout the vehicle lifecycle, from purchase to ownership and maintenance. These issues impact their purchasing decisions, satisfaction levels, and overall experience.

For B2C customers, a primary pain point is the high cost of vehicle ownership in Brazil. This includes not only the initial purchase price, which is inflated by a complex and heavy tax burden ("Custo Brasil"), but also ongoing expenses such as high annual taxes and licensing fees. [13, Value Chain Context] The difficulty in affording a vehicle is particularly acute for lower-income individuals and underserved groups who may lack the necessary credit scores or proof of income to access traditional financing options, limiting their mobility and economic opportunities. The financing process itself can be a source of pain, traditionally involving manual, paper-based processes that can be inefficient and create uncertainty regarding loan approval.

In the aftermarket, both B2C and B2B customers face challenges related to elevated maintenance and repair costs, partly due to import tariffs on parts and a complex distribution system. [13, Value Chain Context] The availability and price of parts, as well as the trustworthiness and expertise of repair shops, are key concerns for aftermarket customers. [Final Customers Identification] The presence of counterfeit products in the market also poses a risk to quality and safety.

The transition to electric vehicles (EVs), while presenting opportunities, also introduces pains for early adopters. The high purchase cost of EVs compared to traditional flex-fuel vehicles remains a significant barrier for the average consumer. A major concern is the limited and unevenly distributed public charging infrastructure across the vast country, creating range anxiety and limiting the practicality of EVs for many users, especially for longer distances or in rural areas.

Beyond the financial aspects, customers experience bureaucratic hurdles and complexities associated with vehicle ownership in Brazil. Managing annual taxation, licensing, and fines often requires navigating a complex system with multiple interactions with public entities and varying processes across different departments.

For B2B customers, particularly large fleet operators and agricultural/construction businesses, the specific requirements related to vehicle type, payload capacity, service intervals, and telematics features need to be met by manufacturers and service providers. [Final Customers Identification] Auto parts distributors and retailers, as B2B customers of manufacturers, are concerned with supply chain efficiency, inventory management, and the availability of a wide range of parts. [Value Chain Context] Repair workshops, another key B2B segment, rely on timely delivery of quality parts and access to training for new vehicle technologies. [Value Chain Context]

Furthermore, across both B2C and B2B segments, customer experience in the automotive industry is often perceived as substandard when compared to other industries like online and physical retail. Unsatisfactory aftermarket services, inadequate vehicle utility and functionality, and issues with servicing and maintenance are significant factors driving customers to switch brands. The hassle-free experience that customers seek is not always met.

Prioritized Table of Challenges and Pains:

Priority Challenge/Pain Customer Segment Affected
1 High Cost of Vehicle Ownership (Purchase & Taxes) B2C, partially B2B
2 Difficulty Accessing Affordable Financing B2C, some B2B
3 High Maintenance and Repair Costs B2C, B2B
4 Limited and Uneven EV Charging Infrastructure B2C, B2B (EV owners/fleets)
5 Bureaucratic Hurdles of Vehicle Ownership B2C, B2B
6 High Purchase Cost of Electric Vehicles B2C, B2B
7 Aftermarket Part Availability, Price, and Quality B2C, B2B
8 Finding Trustworthy and Skilled Repair Services B2C, B2B
9 Substandard Customer Experience in Automotive B2C, B2B
10 Supply Chain Complexity & Import Dependency (for B2B) B2B

Correlation with Value Chain

These customer challenges and pains are directly correlated with various steps and players within the Brazilian automotive value chain:

  • Upstream/Supply Chain & Manufacturing/Assembly: The high tax burden contributing to the high cost of vehicles is a government/regulatory issue impacting the entire chain, but felt acutely by customers at the point of sale. [Value Chain Context] The reliance on imported components in the upstream segment can influence the final cost of vehicles and parts, affecting affordability for both B2C and B2B customers and contributing to high maintenance costs. [Value Chain Context] The complexity and cost of the supply chain can also impact the price and availability of parts in the aftermarket. [13, Value Chain Context]
  • Distribution and Sales: The traditional dealership model is the primary interface for new vehicle sales to B2C customers, and their ability to offer competitive pricing, financing options, and a positive customer experience directly addresses (or exacerbates) pains related to purchase cost, financing access, and overall experience. [Final Customers Identification, Value Chain Context] The efficiency of vehicle logistics impacts the availability of vehicles at dealerships. [Value Chain Context] The process of obtaining financing, involving financial institutions and dealerships, is a key pain point that digital solutions are starting to address.
  • Post-Sales/Aftermarket: This entire segment of the value chain is directly correlated with the pains of high maintenance/repair costs, part availability/price/quality, and finding trustworthy repair services. Parts manufacturers, distributors, retailers, and repair workshops all play a role in addressing these challenges. The fragmentation and potential informality in the aftermarket can contribute to inconsistent service quality and difficulty in finding reliable options. [Value Chain Context]
  • Ancillary Services: Financial institutions directly impact the customer pain related to accessing affordable financing. Logistics providers influence the cost and efficiency of moving vehicles and parts, indirectly affecting final prices and part availability. [Value Chain Context] Technology providers have a role in improving customer experience through digital platforms for sales, financing, and aftermarket services.
  • Electrification Transition: The high cost of EVs is linked to manufacturing costs and potentially limited local production of key components like batteries (Upstream/Manufacturing). The lack of charging infrastructure is a challenge for energy companies, technology providers, and government bodies involved in infrastructure development (Ancillary Services).
  • Economic and Political Instability: Broader economic conditions and interest rates, influenced by government policies and financial institutions (Ancillary Services), directly impact vehicle affordability and access to financing for all customer segments. [7, 9, Value Chain Context]

Effectively addressing these customer challenges and pains requires coordinated efforts across the entire value chain, from policy makers influencing taxation and infrastructure to manufacturers focusing on cost-effective technologies and improved customer service, and aftermarket players ensuring quality and accessibility of parts and services.

References

  • ANFAVEA (Associação Nacional dos Fabricantes de Veículos Automotores). https://anfavea.com.br/
  • Sindipeças (Sindicato Nacional da Indústria de Componentes para Veículos Automotores). https://www.sindipecas.org.br/
  • FENABRAVE (Federação Nacional da Distribuição de Veículos Automotores). https://www.fenabrave.org.br/
  • Agência Brasil: Brazil creates program to decarbonize national fleet. https://agenciabrasil.ebc.com.br/en/economia/noticia/2024-05/brazil-creates-program-decarbonize-national-fleet
  • Automotive Logistics: Brazil introduces new auto incentive programme. https://www.automotivelogistics.media/brazil/brazil-introduces-new-auto-incentive-programme/45124.article
  • Energy Connects: Brazil's Beloved Sugar-Cane Cars Are Slowing EV Adoption. https://www.energyconnects.com/news/renewables/2024/june/brazil-s-beloved-sugar-cane-cars-are-slowing-ev-adoption/
  • Mordor Intelligence: BRAZIL USED CAR MARKET SIZE & SHARE ANALYSIS - GROWTH TRENDS & FORECASTS UP TO 2029. https://www.mordorintelligence.com/industry-reports/brazil-used-car-market
  • Reuters: Brazil posts record auto financing in 2023. https://www.reuters.com/business/autos-transportation/brazil-posts-record-auto-financing-2023-2024-01-29/
  • TozziniFreire: News for the automotive sector in Brazil: Mover Program has been introduced. https://www.tozzinifreire.com.br/en/news-views/news-for-the-automotive-sector-in-brazil-mover-program-has-been-introduced/
  • Analysis of Fleet Management Policies for Offshore Platform Supply Vessels: The Brazilian Case - MDPI. https://www.mdpi.com/2077-1312/13/3/686
  • Anatomy of the Brazilian middle class: identification, behaviours and expectations - CEPAL Repositorio Digital. https://repositorio.cepal.org/handle/11362/40362
  • Brazilian population change by social class Source: Prepared by the... - ResearchGate. https://www.researchgate.net/figure/Brazilian-population-change-by-social-class-Source-Prepared-by-the-authors-based-on-data_fig1_284151515
  • How business aviation in Brazil is set to grow | Business Airport International. https://www.businessairportinternational.com/features/how-business-aviation-in-brazil-is-set-to-grow.html
  • Global Automotive Executive Survey 2019 - Brazilian Chapter - KPMG International. https://kpmg.com/br/pt/home/insights/2019/06/pesquisa-global-executivos-industria-automotiva-2019-capitulo-brasil.html
  • TRENDS IN THE GLOBAL VEHICLE FLEET 2023. https://fiafoundation.org/media/557209/trends-in-the-global-vehicle-fleet-2023.pdf
  • B2B Business Platform in Brazil | B2BMAP. https://www.b2bmap.com/brazil-b2b-marketplace
  • B2B Sample Brazil - Sample Solutions. https://www.sample-solutions.com/b2b-sample-brazil
  • The Electric Vehicle Market in Brazil: A Systematic Literature Review of Factors Influencing Purchase Decisions - MDPI. https://www.mdpi.com/2071-1050/15/23/16911
  • Roadwork ahead! Commercial vehicles face new go-to-market challenges - McKinsey & Company. https://www.mckinsey.com/industries/automotive-and-assembly/our-insights/roadwork-ahead-commercial-vehicles-face-new-go-to-market-challenges
  • Brazil B2c E-commerce Market Size & Outlook, 2023-2030 - Grand View Research. https://www.grandviewresearch.com/industry-analysis/brazil-b2c-e-commerce-market
  • South America Automotive E Commerce Market Size, Growth, Trends 2035. https://www.kbvresearch.com/south-america-automotive-e-commerce-market/
  • Brazil Last-Mile Delivery Market Share & Size Report 2033 - IMARC Group. https://www.imarcgroup.com/brazil-last-mile-delivery-market
  • Brazil Three Wheeler Market | Size, Share & Volume 2031 - 6Wresearch. https://www.6wresearch.com/industry-report/brazil-three-wheeler-market
  • B2B Parts 2025 Company Profile: Valuation, Investors, Acquisition | PitchBook. https://pitchbook.com/profiles/company/B2B-Parts-2025-BR#overview
  • Brazilian Bank Disrupts the Auto Loans Process - Accenture. https://www.accenture.com/us-en/case-studies/banking/brazilian-bank-disrupts-auto-loans
  • Kovi's Innovative Auto Financing Model Helping to Drive Better Financial Health in Brazil. https://www.unsgsa.org/news/kovis-innovative-auto-financing-model-helping-drive-better-financial-health-brazil
  • A study on competition issues in the automotive sector : Report by the competition authorities of BRICS working group on automotive sector - The Competition Commission. https://www.compcom.co.za/wp-content/uploads/2023/07/BRICS-Competition-Authorities-Working-Group-on-the-Automotive-Sector-Study-Report.pdf
  • Implementing Loan-to-Value Ratios: The Case of Auto Loans in Brazil (2010-11) - Banco Central. https://www.bcb.gov.br/pec/wps/english/wps228.pdf
  • Brazil offers hope for growth | FenderBender and ABRN. https://www.fenderbender.com/articles/8097-brazil-offers-hope-for-growth
  • Challenges and Opportunities for Electric Vehicle Charging Stations in Latin America - MDPI. https://www.mdpi.com/2077-1312/13/3/686
  • Brazil Car Loan Market to Grow with a CAGR of 4.34% through 2030 - TechSci Research. https://www.techsciresearch.com/report/brazil-car-loan-market/21070.html
  • Brazil Automotive Aftermarket Market (2025-2031) | Trends, Outlook & Forecast. https://www.6wresearch.com/industry-report/brazil-automotive-aftermarket-market
  • Brazil Car Loan Market By Size, Share & Forecast 2030F | Techsci Research. https://www.techsciresearch.com/report/brazil-car-loan-market/21070.html
  • Electric cars: challenges and innovations in the charging market in Brazil - Amplifica Digital. https://amplificadigital.com.br/blog/eletric-cars-challenges-and-innovations-in-the-charging-market-in-brazil/
  • Obstacles to growth of the electric car market in Brazil - Revista Fapesp. https://revistapesquisa.fapesp.br/en/obstacles-to-growth-of-the-electric-car-market-in-brazil/
  • Autel, Enel X, Huawei, Voltbras and WEG Discuss Challenges for Charging Infrastructure in Brazil - Latam Mobility. https://www.latammobility.com/en/brazil-en/autel-enel-x-huawei-voltbras-and-weg-discuss-challenges-for-charging-infrastructure-in-brazil/
  • Gringo: Revolutionizing the Brazilian Driver Experience - VEF. https://vef.partners/wp-content/uploads/2024/02/VEF-Gringo-Case-Study_Feb-24.pdf
  • Brazil Auto Parts And Accessories Market (2025-2031) | Trends, Outlook & Forecast. https://www.6wresearch.com/industry-report/brazil-auto-parts-and-accessories-market
  • Brazil's - World Bank Open Knowledge Repository. https://openknowledge.worldbank.org/server/api/core/bitstreams/453d6b15-b00f-569d-82f3-7a664803306d/content
  • Joining the race - Capgemini. https://www.capgemini.com/wp-content/uploads/2024/05/Joining-the-race-Automotives-drive-to-catch-up-with-customer-experience.pdf
  • Beyond vehicle ownership: changing the way consumers think about mobility | Deloitte US. https://www2.deloitte.com/us/en/insights/industry/automotive/future-of-mobility-consumer-behavior.html
  • The Growth of Electric Vehicles in Brazil: A Sustainable Revolution - Climate Scorecard. https://climatescorecard.org/2025/03/the-growth-of-electric-vehicles-in-brazil-a-sustainable-revolution/
  • Inovar Auto: Evaluating Brazil's Automative Industrial Policy to Meet the Challenges of Global Value Chains - ResearchGate. https://www.researchgate.net/publication/361382349_Inovar_Auto_Evaluating_Brazil's_Automative_Industrial_Policy_to_Meet_the_Challenges_of_Global_Value_Chains
  • How Rivian is Revolutionizing the EV Purchasing Experience - Qualtrics. https://www.qualtrics.com/blog/rivian-customer-experience/