With an incentive of R$19 billion, the market views the government's green car program with optimism: 'Predictability to invest'

The federal government launched “Mover” on December 30th, national green mobility and innovation program. This is a new phase of the old Rota 2030, which will have a tax incentive of R$ 19 billion until 2028. With the measure, the objective is to expand the decarbonization of the fleet and stimulate the production of new technologies, whether for passenger cars, buses and trucks.

According to the executive, the Mover MP creates the so-called FNDIT (National Fund for Industrial and Technological Development), which will be managed by BNDES and under the coordination of the Ministry of Development, Industry, Commerce and Services.

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Electric market

For ABVE (Brazilian Electric Vehicle Association), the measure is positive and provides predictability for companies in the sector to invest in hybrid and electric vehicles and parts.

“The big news for ABVE member companies, which are already producing in Brazil and others that are bringing investment here, is the inclusion of electromobility within the incentive conditions of the local condition”, says Ricardo Bastos, president of the association, with exclusive to IstoÉ.

Another detail is that in addition to new technology vehicles, this includes the production of components (such as batteries) and encompasses the auto parts chain.

“The program was very motivating. Several associated companies are including this within their business plan and investment perspectives. It is an important addition to the plans that were being prepared. When we know the next five years and these next five years come with important ingredients that will allow incentives, this is very positive and will accelerate investments.”

For Bastos, the tax credit offered by Mover is more transparent.

“You make the investment, the research, the development. Know the rules on how to get hold of credit and how to use that credit. In other words, it will be much easier for you to appropriate and use it to pay any federal taxes and contributions. It’s not that credit that you have to offset in your income tax.”

There will still be regulations, but in theory if the company does research, development, installs factories in Brazil, to name a few, it has the exact criteria and will know the percentages for calculating incentives.

“The trend is that in two or three years, electric vehicles will have the same price as combustion models. This is a global trend. The electrified vehicle started at a higher price level and with low volume. But the name of the game in the auto industry is scale. When you have scale and volume, it significantly reduces cost and price. Local production will help reduce costs too. With Mover, the auto parts manufacturer that sets up shop in Brazil will begin to have production and scale.”