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Apple has been gradually diversifying its supply chain for its products in recent years, with China still accounting for the majority of its production. However, the company has been shifting production away from China and has now started assembling the iPhone 14 in Brazil. This move comes as Apple looks to reduce its reliance on China and avoid supply chain disruptions caused by the COVID-19 pandemic and political disputes affecting its suppliers.
A reader of the Brazilian blog MacMagazine recently purchased a blue 128GB iPhone 14 in Brazil and was surprised to see that the device was “Assembled in Brazil” by Foxconn Brazil, located in São Paulo. The device’s Part Number ends with “BR/A”, confirming that it was assembled locally. However, it seems that only the regular iPhone 14 is being assembled in Brazil so far, as the 14 Pro and 14 Plus models are still identified as being produced in China.
This is not the first time that Apple has assembled iPhones in Brazil. Last year, the company did the same with the iPhone 13. The iPhone SE is also assembled in Brazil, as the company focuses on assembling its less expensive devices in the country due to the local economic situation. For both Apple and its customers, this is good news.
Brazil imposes high taxes on imported products, which include pretty much every Apple device. Some companies invest in assembling their products in Brazil to sell those products at a lower price due to a reduction in taxes. The 128GB iPhone 14 costs R$7,599 ($1,520) in Brazil, but customers can now find the same model for around R$5,000 ($1,000) in local retail stores.
Producing iPhones in Brazil is beneficial to Apple because the company has been trying to reduce its dependence on China. Apple’s facilities in China have been deeply impacted by the strict local COVID-19 policies. At the same time, there are also political disputes affecting Apple’s suppliers.
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In November 2022, Apple warned investors and customers for the first time that the availability of the iPhone 14 Pro would be quite limited in the 2022 Holiday Season due to the situation in China. According to a recent report, Apple has tripled the production of iPhones in India since then.
Even if the assembly of iPhones in Brazil is only focused on the local market, it can be enough to avoid supply shortages in the country. For the iPhone 15 later this year, Apple is hoping that assembly will begin in China and India simultaneously. As Apple continues to diversify its supply chain, it remains to be seen how this will impact the company’s production and pricing strategies. However, for now, the ability to produce iPhones in Brazil is a positive development for both Apple and Brazilian consumers.