Apple is planning to expand its manufacturing in Brazil to mitigate the effects of U.S. tariffs on imports from China and India. By increasing assembly operations, Apple seeks to avoid passing cost increases to consumers while focusing on local and export markets. The company is set to start production of the upcoming iPhone 16 in Brazil, following its successful assembly of earlier models.
Apple is exploring the possibility of enhancing its manufacturing capabilities in Brazil as a strategic response to newly imposed U.S. tariffs on imports from China and India. Following the Trump Administration’s announcement of tariffs—34% on Chinese products and 26% on Indian imports, which are crucial for Apple’s hardware production—the company is seeking to mitigate cost increases for consumers.
The expansion of Apple’s assembly operations in Brazil is motivated by the more favorable 10% import tax applicable in that region. Reports indicate that Apple, in collaboration with its manufacturing partner Foxconn, has secured certification to commence assembly of the iPhone 16 in Brazil. Presently, the facility is engaged in the production of the iPhone 13, 14, and 15.
Plans for expanding operations will include the iPhone 16 Pro, necessitating additional investments and restructuring efforts. These enhanced manufacturing activities aim not only to meet local demand but also to facilitate exports to the U.S., enabling Apple to circumvent a substantial portion of the new tariffs while keeping prices competitive in the market.
In conclusion, Apple’s consideration to expand its manufacturing in Brazil represents a strategic initiative to manage the financial impact of U.S. tariffs on imported goods. By scaling operations and producing more devices locally, Apple aims to reduce costs and maintain pricing for consumers, while also preparing for future product launches such as the iPhone 16 Pro. This move may enhance their capability to export directly to the U.S., effectively mitigating tariff pressures.
Original Source: www.channelnews.com.au
