Apple Considers Expanding Brazilian Operations to Counteract Asian Tariffs
Apple Inc. is considering expanding its operations at the Foxconn factory in Jundiai, Brazil, to combat rising production costs and tariffs impacting its suppliers in Asia. With over half of its smartphone shipments currently from China and recent price increases, Brazil presents a more favourable manufacturing environment due to lower export duties.
Apple Inc. is reportedly evaluating the potential expansion of its operations at the Foxconn factory located in Jundiai, Sao Paulo. This consideration is primarily a response to the rising production costs associated with its Asian manufacturing, especially as new tariffs impact suppliers in China and India. The information was shared in a report by Brazilian Exame magazine.
Presently, more than fifty percent of Apple’s smartphone shipments are sourced from China, which has recently been subjected to significant tariffs imposed by the United States on April 2. In addition to these penalties, China has enacted a substantial 34% tariff in retaliation. India, which has experienced a surge in device production, is facing similar challenges with a 26% levy impacting its manufacturing costs.
Foxconn’s facility in Jundiai has been a longstanding assembly partner for Apple, producing various models of the iPhone, including base versions of the iPhone 13 through 15, and has received approval to manufacture the upcoming iPhone 16. The Brazilian export environment is relatively favourable, with a modest 10% duty on exports to the United States, making Brazil an attractive alternative for Apple’s manufacturing needs.
In summary, Apple’s potential expansion in Brazil is a strategic response to the increasing production costs driven by tariffs affecting its Asian suppliers. The Foxconn facility in Jundiai represents a viable relocation option, given its existing relationship with Apple and the favorable tariffs in Brazil. This move may help Apple maintain competitiveness in the global smartphone market while mitigating the adverse impacts of international trade tensions.
Original Source: breakingthenews.net
