Argentina automotive sector posts 18% production decline as tax reforms reshape market

Argentina’s auto industry recorded a sharp contraction in the first half of 2026. Vehicle production fell 18 % compared with the same period a year earlier, and registrations in June dropped 12.8 % year‑on‑year to 45,995 units, with a cumulative six‑month total of 294,181 units, 9.9 % lower than in 2025.

The government announced a schedule to eliminate industrial export retentions under Decree 566/2026, removing duties from roughly 90 % of previously taxed products and targeting full removal by 2027, with only a few items such as fertilizers, steel and aluminum remaining partially taxed.

Separately, the removal of the “luxury car” internal tax was said to have increased fiscal revenue. Secretary of Productive Coordination Pablo Lavigne explained that although the tax on high‑end vehicles (17.5 % internal tax plus tariffs) was abolished, overall collections rose from 27 billion to 75 billion pesos due to higher import volumes.

Industry leaders noted signs of recovery in the premium segment, with Mercedes‑Benz, Porsche and BMW reporting strong sales, while some brands continued to see declines.