South American Policy

In Brazil, our largest South American market, the large scale use of biofuels is a national policy. All gasoline is blended with 20 to 25 percent ethanol, and pure ethanol is extensively used as motor fuel. Most new vehicles are flexible-fuel vehicles, which are designed to accommodate fuel containing a range of ethanol content. Also, a minimum of 5 percent biodiesel must be added to diesel.

Brazilian emission requirements are periodically updated through an emissions-control program. Brazil also introduced a voluntary vehicle energy-efficiency labeling program; the labels indicate fuel consumption rates for light-duty vehicles with a spark-ignition engine. While the program is voluntary, Brazil also published a new automotive regime that requires participation in the fuel-economy labeling program with improved fuel consumption starting on October 1, 2016. Failure to achieve an absolute target for “corporate energy efficiency” as a function of “fleet corporate average mass” will result in a substantial tax increase and cumulative fines on all automotive domestic sales (local production and imports) retroactive as of January 2013. Additional tax reductions are available if further fuel-efficiency improvements are achieved. A star ranking for light vehicles was also recently introduced, favoring low-emission, low-carbon-dioxide (CO₂), ethanol, flexible-fuel and hybrid vehicles. Diesel use in light vehicles under a one-ton payload is not allowed in Brazil, except for combined-usage vehicles with special off-road characteristics. Ten Brazilian states have issued vehicle pollution control plans and are taking actions to implement in-use vehicle inspection and maintenance programs. Brazil also phased-out S-1800 diesel fuel and now only markets S-10 and S-500; also, sulfur content in gasoline has been lowered to 50 ppm maximum.

In 2013, most of Ford’s light-duty products in Brazil were offered as ethanol flexible-fuel vehicles. The new Ford Focus introduced in Brazil in 2013 is the world’s first direct-injection flexible-fuel engine. We also provide light- and heavy-duty vehicles that meet biodiesel requirements.

Other South American countries, such as Argentina and Colombia, have significantly increased the use of biofuels. And in 2013, Chile introduced requirements that the fuel-consumption and CO₂-emissions levels of light-duty vehicles be posted at sales locations and in owners’ manuals.