A New Era for the Argentine Automotive Industry
The automotive market in Argentina is undergoing unprecedented change, from internal reform and regulatory change to external investment and interest from brands overseas. After years of an insulated and protective environment, the automotive market in Argentina is opening up, embracing new competition and allowing for more options for buyers and sellers.
One of the main drivers of this change is the arrival of a slew of new brands, many of them Chinese, looking to stake a claim on the automotive market in Argentina. These brands have to compete for market share with long-established players, while dealerships and car makers must adapt to a new reality that has consumers at the center of the equation.
Macroeconomic reforms, along with reduced restrictions on imports, have created a more open environment for the automotive market in Argentina.
More precise rules of engagement, more stability in the business environment, and fewer import barriers have made Argentina’s automotive sector more attractive to overseas players. As Santos Doncel Jones, an industry expert and partner at Price Waterhouse Coopers, puts it, “We’re coming from a very closed market, with just those who were capable of manufacturing locally able to survive. Today, we’re coming from a market that’s open and has options.”
History Lesson: Scarcity is giving way to competition
Traditionally, the automotive market in Argentina was defined by a scarcity of options for the average buyer. Imports were restricted, while the pricing of vehicles fluctuated wildly due to the high inflation rate. Many people relied on bank financing, but loans weren’t always accessible. All of these factors created a market that was virtually monopolized by those who could make vehicles in Argentina, leaving many customers to accept whatever they could get.
The scarcity of options left dealerships with plenty of leverage over customers. However, in the modern market, those conditions are being turned on their head. Brands are going to have to fight to attract, convince, and retain customers, all of whom will be much more informed about what’s on offer.
Larger market for new vehicles: The industry’s fleet is getting older
Perhaps one of the most telling indicators that there’s an opportunity in the automotive marketing in Argentina is that the average age of the nation’s vehicle fleet is relatively high. According to Redoo, a consulting firm that helps businesses digitize and streamline their operations, just 13% of vehicles currently in circulation in Argentina are under five years old. An astounding 65% of the cars on the road in the country are more than ten years old.
Vehicles in Argentina generally last longer than in Europe and other more advanced countries in Latin America, where the vehicle-renewal cycle tends to be between five and ten years. In Argentina, approximately 20% of the fleet falls into that age bracket, indicating a significant opportunity for replacement and modernization as new vehicles come onto the market and more financing options become available.
Investments worth USD 650 million are expected in Argentina as new players enter the market and establish themselves
With the entry of new players, especially importers of overseas brands, the amount of money being invested in the automotive market in Argentina is expected to rise. Doncel Jones states that the new entrants could bring in about USD 650 million to the country over the next two years, including the cost of building out networks and the physical presence of dealerships.
One estimate is that a new dealership is expected to cost between USD 2 million and USD 4 million to get off the ground, not including the investment made by the importers themselves. Aside from the capital investment, these projects could create more than 2,000 direct jobs, helping to support the broader economic recovery.
The amount of investment expected in Argentina could have a significant impact on the overall structure of the automotive sector. New entrants are expected to be especially disruptive to dealerships and could lead to a more fractured but more competitive landscape in the future.
The new reality for dealerships: In it to win it
For the dealership networks that already exist in Argentina, the shift towards a more competitive and open market is an opportunity to reinvent themselves. “They have to go back to actually selling—to competing and creatively winning over customers,” said Doncel Jones. It’s not just the external market changes that dealerships will have to adapt to. These organizations will have to restructure themselves, trimming out unnecessary layers and streamlining processes.
With inflation decreasing, bloated costs and operations have become more visible. Dealerships will have to fix those problems now if they want to compete.
Legacy players will have to do a better job of servicing their vehicles if they’re to survive
Automakers that have a history of doing business in Argentina will also feel the pressure. As new entrants chip away at the market, the competition will be tougher. Jones says that these companies will have to “up their game” by improving their processes, cutting costs, and optimizing their workflows.
Customer service will be a non-negotiable priority. With consumer tastes changing rapidly, customers will expect better service, better customer service, and better value for their money. If they don’t get it, brands will find themselves falling out of favor.
The shift to digital is no longer an option, it’s a necessity
One of the major indicators of change in the automotive market in Argentina is the rapid uptake of technology in the sector. Tools like CRM platforms, data analysis, AI-powered marketing automation, and online sales platforms are crucial for gaining insight into customer tastes and behaviors.
Across the automotive sector in Argentina, widespread adoption of these technologies will allow companies to target their audiences more effectively, deliver more customized buying experiences, and keep their customers for longer.
The landscape of the Argentine automotive market could be more fragmented than ever
Historically, the Argentine automotive market has been fairly top-heavy, with a small number of big players. Toyota and Volkswagen have traditionally been the dominant brands in Argentina, accounting for about 20% and 17% of the market, respectively. However, that dominance could be coming to an end.
Doncel Jones says that the market will become more fragmented going forward, making it more similar to the rest of the world, where a 12% to 14% market share is considered sizable. In this market, brand loyalty, product innovation, and responsiveness will be more important than legacy players and historical dominance.
The answer for local automakers may be more exports as the domestic market plateaus
Though market share may be down for local players, that doesn’t mean that overall sales volumes won’t go down if the market plateaus. With the growth of the automotive market in Argentina, perhaps to 750,000 to 800,000 annual sales, local production facilities can continue to operate by targeting the export market in Latin America and other countries.
“If you want to maintain production, you’re going to have to turn towards the export market,” says Jones. Regional integration and the expansion of trade agreements could make this happen.
Good news on the horizon: Sales of vehicles are growing
Vehicle sales are already on the upswing. According to ACARA (Asociación de Concesionarios de Automotores de la República Argentina), new vehicle registrations grew 59.1% year-over-year in May 2025, reaching 55,363 for the month. Year-to-date, registrations totaled 272,837 units, a 78.9% jump compared to the same period in 2024.
With this trend continuing, 2025 could finish with approximately 650,000 vehicle registrations, suggesting that the automotive market in Argentina is coming back from a tough period.
Its neighbors have been taking advantage of a more open market environment for years.
While Argentina is opening its market, some of its neighbors—Chile, Uruguay, and Brazil—have long been open to international manufacturers and have maintained relatively stable macroeconomic environments.
In those markets, the entry and competition of global brands has become commonplace, and infrastructure for dealerships and after-sales support has been built out. If Argentina’s transition to a more open market is executed successfully, it could see the country catch up and even overtake some of its neighbors in innovation and diversity.
The bottom line is clear: There’s no going back
To summarize, the bottom line is that the Argentine automotive market is changing, becoming more competitive, more dynamic, and more customer-focused. Players in the market, from legacy players to dealership networks to new entrants, will have to adapt quickly if they’re to be viable in the new landscape.
“In the short term, legacy brands will have to adapt to a much more informed consumer and a much more open market,” said Santos Doncel Jones.