Uruguay is the second-smallest South American country (after Suriname). It is mostly made up of rolling plains, but also has ferticle coastal lowlands. Most of the population resides in the southern half of the country, with some 80% living in urban areas. Nearly half of the population lives in and around the capital of Montevideo.
During the 2008-09 global financial crisis, Uruguay's economy also slowed down, seeing a 2.6% decelleration in 2009. However, the country did avoid a recession and kept growth rates positive, mainly through higher public expenditure and investment. By 2010, GDP growth reached 8.9% but then decellerated in the 2012-16 period as a result of a renewed slowdown in the global economy and in Uruguay's main trading partners and Mercosur counterparts (Argentina and Brazil). However, reforms in those countries gave Uruguay an economic boost and growth was reported in 2017.
In general, Uruguay has a free market economy characterized by an export-oriented agricultural sector, a well-educated workforce, and high levels of social spending.
3.49 million (August 2021)
Montevideo, with population of 1.38 million (2017)
|Major cities|| |
Montevideo (population of 1.38 million)
|Unemployment rate|| |
9.4% (June 2021)
|Main industries|| |
food processing, electrical machinery, transportation equipment, petroleum products, textiles, chemicals, beverages
|Interest rate|| |
benchmark interest rate
|Political key info|| |
In 2004, the left-of-center Frente Amplio Coalition won national elections that effectively ended 170 years of political control previously held by the Colorado and National (Blanco) parties. Uruguay's political and labor conditions are among the freest on the continent.
7.33% (June 2021)
|Total Car park|| |
276,900 vehicles (one in every 3.6 people)
|New vehicle registrations (Cars, LCV, Trucks)|| |
In 2019, vehicles sales fell 8% to 40,605 units from 44,215 (source: OICA)
|Top 5 brands (total market)|| |
Best-selling brands in 2018, passengers vehicles
1. Volkswagen (6,019 vehicles) down 25% year-over-year
|Model preference top 5 (total market)|| |
|Evolution fleet sales (last 5 years)|| |
In 2019, commercial vehicles sales rose 7.2% to 10,542 units from 9,838 (source: OICA)
Special internal tax IMESI on Naptha vehicles
23% (up to 1,000 cc)
28.75% (1,001-1,500 cc)
34.5% (1,501-2,000 cc)
46% (larger displacements)
Special internal tax IMESI on Gasoil vehicles
IRAE (economic) and IMEBA (livestock goods) corporate tax on utility vehicles
6% (up to 1,600 cc)
11.5% (larger displacement gasoline vehicles)
34.7% (diesel vehicles)
22% VAT (one of the highestin Latin America)
Import duty equivalent to 23% of the value of the vehicle (except Mercosur countries and Mexico)
5% consular fee.
Tariffs for electric vehicles imports is 0%
IMESI tax is 5,75%
Moreover, UTE ((national administration of power plants and electrical transmissions)) is offering a US$10,000 subsidy for electric taxis, and a 50% discount on energy charge for taxis until 2020.
Vehicle price comparison affected by tax and legislation
Considering a new car in 2016 (same brand, model, and characteristics), the average price for vehicles, according to the Uruguay automobile business association ACAU, are:
1400cc vehicle: Uruguay US$26,990; Argentina US$20,589 (23.7% less); Chile US$15,456 (42.7% less)
1,901cc vehicle: Uruguay US$68,990; Argentina US$63,271 (8.2% less); Chile US$39,900 (42.1% less)
4X4 truck of 2,500cc: Uruguay US$51,990; Argentina US$39,328 (24.3% less); Chile US$23,987 (53.8% less).
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Bank financing facilities are better for 0km cars than used cars. For 0km, financing could reach 100% of the value of the vehicle with installments of up to 60 months. Older cars (more than six years) should expect 50% financing and 36-month loans.
Keep in mind that currency makes a difference. For instance, risk increases when you take out a loan in US dollars but generate income in Uruguayan pesos so expect less favorable loan conditions if you are in this situation. However, there are some banks which have special deals with automakers and more favorable conditions can be obtained with them.
Among the types of loans are General financing where loan terms vary, Bonus Rate financing which offer rates lower than General financing, and even Zero Rate loans where up to 50% of the vehicle’s value can be financed.
Also offered in the country are One-Year loans which are one year fixed-term loans which can be canceled or refinanced in monthly installments, and Intelligent loans which permits financing for up to two thirds the value of the vehicle. The latter entails an amortizable loan for 50% of the vehicle value and a general 36-month loan for the remaining 50%. At the end of the loan period, you may renew the loan and change your vehicle.
Financing v.s. Leasing
For general financing, the vehicle remains in the name of the person who took out a loan. For leasing, the vehicle remains in the name of the bank with a buy out option at the end of the leasing period.
Remeber that leasing can only be contracted by companies that pay economic activities income tax IRAE and meet other conditions. Auto loans, however, can be requested by companies or individuals.
July 26, 2021
Average gasoline price per liter: US$1.50 (world average is US$1.19)
Average diesel price per liter: US$1.04 (world average is US$1.06)
Average electricity price per kWh Households: US$0.20 (world average is US$0.14)
Average electricity price per kWh Business: US$0.09 (world average is US$0.12)
Cities in Uruguay are among those with the most expensive petrol prices in Latin America.
TCO is highly affected by the implementation of electric vehicles (EV) in Uruguay and neighoring countries.
As for Uruguay, since 2015, electric vehicles (EV) for passengers have been exempted from paying the 23% tariff on imports. As for electric-powered light commercial vehicles (LCV), this exemption has been in effect since the end of 2017 (expires 2022) and owners of these vehicles have other benefits under the country’s investment law.
Besides spending 80% less on energy than an internal combustion engine (ICE) vehicle, maintenance is cheaper on an EV. However, the purchasing price of these vehicles are quite expensive (approximately double to that of a comparable vehicle) so the market is still very incipient. The hybrid vehicle fleet in Uruguay is a bit more developed though, beneifiting from a special internal tax Imesi lower than electric vehicles.
Depending on the category of the vehicle, Law 19.061 (January, 2013) stipulates the need for seat belts, headrests, front airbags, ABS braking, and anchors for child restraint systems.
New vehicle regulations currently under discussion include those seeking electronic stability control, speed limiters, sound and visual alerts for seat belt positioning, automatic activation of lights, tires and rear-view mirrors incorporated as duly certified products, occupant protection in the case of frontal and lateral impact, as well as pedestrian protection measures.
Car insurance in Uruguay is very customized. Insurers develop tailor-made policies for their clients based on data on kilometer usage, risk exposure, good driver behavior, and other key issues, and much of this is linked to telematics. This has led to more regulated fleet operations, and many insurance companies have actually developed their own mobile apps and services to manage their operations.
For one, Sancor Seguros launched "Intelligent Auto" in 2018, a new telematics supported product which involves installing a telematics device in each vehicle, carrying out data processing on braking, acceleration, suddeng movements, kilometers traveled, time on the road, and others. From the data processed, the device can give tips on the safer and more efficient handling of your vehicles.
Besided telematics qualifying you for price promotions and benefits from insurance companies, it can also cut fleet operational cost by up to 30% in some cases.
Uruguay is considered one of the places in the world with the highest penetration of renewable energies, according to the reneweable energies global repoort "Renováveis 2017 - Relatório Global".
Uruguay has managed to become the country with the highest proportion of electricity generated from wind energy in Latin America and fourth in the world. Over the last 10 years, 43 wind farms have been installed alongside other forms of renewable energy: solar, biomass and hydropower.
Today, almost 95% of the country's electricity comes from sustainable energy which ensures secure and stable infrastructure able to handle the tourist seasons.
From 2 May to 31 December, 2018, the Montevideo municipal government - by far the largest urban region in Uruguay - had been prohibiting new driver applications to work for ride-hailing companies such as Uber and Easy as more than 3,600 drivers had been already operating throughout the region.
The restriction has become a large debate between unions, associations and Uber and Easy.
In Uruguay’s push to implement electric vehicle (EV) infrastructure, its government – in early January 2018 - announced the first electric highway in Latin America, inaugurating its first 300km stretch between Colonia and Punta del Este with a guaranteed power charge.
With charge points situated 60km away from each other as international standards mandate, the government's goal is to have a highway network covering the entire country. Current EVs in the country have ranges from 150km to more than 300km.
According to the country’s national administration of power plants and electrical transmissions, UTE, the development of electric-mobility is aimed at environmental benefits more than economic benefits right now. UTE aims to improve the quality of life of all users, and ultimately, improving the country.
To further push the EV transition, besides tax breaks on vehicle purchases, UTE is offering US$10,000 subsidy for each electric taxi and a 50% discount on energy charge for taxis until 2020.