Hugo Barra Xiaomi Foxconn Brazil KK

Foxconn To Assemble Xiaomi & Asus Smartphones In Brazil

July 7, 2015 - Written By Kishalaya Kundu

Last year itself, Xiaomi’s VP of global operations, Mr. Hugo Barra, had spoken in earnest about the international aspirations of the Chinese smartphone company, having just launched its products in India, making the country the very first international market for Xiaomi. Last Tuesday, June 30th, the company finally launched its first smartphone outside Asia, when it held multiple launch events for the entry-level Redmi 2 in Sao Paulo, Brazil. The device will sell for a price of 499 Real ($160), and will reportedly be manufactured locally by Taiwan-based OEM Foxconn Electronics (Hon Hai Precision Industry Co. Ltd.). Smartphones with comparable hardware are said to sell for more than twice as much in the South American country because of high import duties. On July 3rd, Mr. Barra twitted a picture of the Redmi 2 production line in the Foxconn factory, with the caption “Xiaomi’s manufacturing line in Brazil is up and running, powered by Foxconn!”

Taiwanese consumer electronics major Asus is also said to be prepping the launch of its second generation ZenFone series of smartphones in the South American country sometime in August this year. According to sources, the company will launch two of the myriad ZenFone 2 models in the country to begin with, and both will be manufactured by Foxconn, the world’s largest contract manufacturer of electronics. By locally assembling smartphones meant for the Brazilian market, both companies are looking to take advantage of the tax relief provided by the Brazilian government for locally manufactured and assembled goods, while charging inordinately high customs duty on imported consumer electronics products, leading to severely inflated pricing compared to most other markets.

Brazil is said to have the world’s fourth fastest growing smartphone market, and is expected to account for 63 million smartphones this year, according to market research and analysis firm, IDC. South Korean vendor Samsung is the market leader in the country with around 50 percent share of the market. Other Taiwan-based notebook ODMs (Original Design Manufacturers) like Quanta Computer and Compal Electronics have also set up factories in the country in recent times to take advantage of the reduced taxation. Foxconn meanwhile, is also said to be in talks with corporate houses in India to set up manufacturing facilities in the country. The company is rumored to assemble Xiaomi’s and Apple’s smartphones in India to begin with, once the facilities are up and running.