In anticipation of a potential fuel consumption standard for light-duty vehicles in Colombia, we evaluated the potential technology pathways for Colombia to reduce fleet-average fuel consumption and CO2 emissions for internal combustion engine (ICE) passenger cars (PCs) and light commercial vehicles (LCVs) in 2030. We developed estimates for incremental technology cost estimates to auto industry and incremental retail price to consumers for both imported and locally assembled vehicles, providing policymakers and industry stakeholders with the analytical foundation for informed standards development. We also analyzed the cost-competitiveness of the top-selling battery electric vehicle (BEV) models with comparable ICE vehicles (ICEVs) sold in Colombia.
Our cost projections indicate that meeting the potential 2030 stringency levels is economically feasible for both vehicle types and industry segments. Retail price increases for ICE PCs are modest at approximately US$130 for locally assembled vehicles and US$170 for imports, reflecting Colombia’s tax structure and incentives for domestic industry. The estimated incremental cost of technology – before combining the markup for local taxes and tariffs – is even modest, at roughly US$100 for ICE powered PCs. Such markup of incremental retail price from the incremental cost of technology demonstrates the substantial impact of Colombia’s tax structure for the ICE vehicles.