Automotive industry

The automotive industry is one of the main economic activities in Brazil. In 2012, the country was the seventh largest global manufacturer of vehicles, with the production of about 3.3 million units. São Paulo is the heartland of the national automotive industry.

Ford, General Motors, Honda, Hyundai, Mercedes-Benz, Scania, Toyota, Chery, Volkswagen, to name a few, operate in the state. In 2012, São Paulo accounted for 42% of all Brazilian production. Besides leading national production, São Paulo is the fifth largest auto producer in the Americas (behind the United States, Brazil, Mexico and Canada).

Whereas Brazil’s internal market is the 4th largest in the world, São Paulo alone accounts for nearly 50% of all vehicles sold in the country.

In order to encourage the automotive sector, in 2008, the Government of the State of São Paulo created the Pro-Vehicle Program, which allows the use of ICMS (sales tax) credits in investments for the modernization and enlargement of the industrial sector, new factory constructions and the development of new products. The program also includes a special scheme that suspends or defers tax due on the import or domestic purchase of machinery and equipment to be used as fixed assets, as a way of offering relief on investment in capital goods.

More info: 
Invest São Paulo (link)