“Apple product assembler Foxconn plans to build five additional factories in Brazil to help cater to demand iPads and other tablets, which are expected to combine for an annual run rate of nearly 400 million units within five years,” Katie Marsal reports for AppleInsider.
“The news was released publicly by São Paulo’s Secretary of Planning and Development of the State, Julio Semeghini,” Marsal reports. “He said the five factories, which are in addition to the one already believed to be turning out iPads and iPhones, will each staff roughly 1000 workers.”
Marsal reports, “Officials from Foxconn and the Brazilian government will reportedly meet following the Chinese New Year to decide on where the factories will be built, but São Paulo is said to be pushing heavily for the investment. Foxconn already receives tax breaks for producing tablets in the region. Last week, the Brazilian government approved tax reductions or exemptions that cleared the way for the company to begin producing iPads in the country.”
Read more in the full article here.
[Thanks to MacDailyNews Readers “Dan K.” and “Lava_Head_UK” for the heads up.]
It’s not like there is a shortage of workers in China, what is the benefit of building factories so far away from the major supply chains in Asia?
So they don’t get held hostage by the Chinese. apple will spread the manufacturing around and make sure they keep control of there business…..
Pretty simple strategy
This is just from memory, but I believe Brazil has huge import tariffs; so high, that a $500 US iPad would be the equivalent of $650 or $700 in Brazil.
Perhaps the economic, regulatory, and labor environments are such that it made sense to manufacture some product there, sell into that market with no import tariffs, and have a manufacturing origin in the western hemisphere – much closer to where more than half the products are ultimately sold.
That doesn’t seem worse than a lot of the EU. I think building them closer to US might be a factor but so much of the supply chain is in Asia. Maybe Apple wants to diversify out of China as a precaution.
It’s actually more than double.
All your eggs in one basket while riding a bike is very unwise.
Exactly.
Actually there is a shortage of workers in China. That’s why wages are going up, and also why companies like Foxconn are building new factories in rural provinces closer to the workers they draw from, as opposed to the coastal cities.
Besides Brazilian tariffs, there are other tariff considerations for other South American countries, countries that are currently not big markets for Apple.
High tariffs, however, it can’t be a bad thing to have some production spread around either, in a country that isn’t a major enemy.
Only chance for argentinians to get access to iPhones
Great move. Brazil is awesome, but the government does not like to import things. And the people here want and need more Apple products.
Go Brazil!