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Old Feb 24, 2012, 12:20 PM   #1
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Apple Now Selling Brazilian-Made iPhone 4, But Pricing Remains High




Foxconn's efforts to bring iPhone and iPad production to Brazil have seen significant attention in recent months, with the move being part of a strategy to diversify manufacturing locations and make the devices more affordable in the world's fifth most populous country by eliminating high import taxes. While much of the focus has been on getting iPad production up and running in Brazil, the company has already been working on iPhone production there, with an 8 GB iPhone 4 having leaked in late November.

The iPhone 4S and 8 GB iPhone 4 debuted in Brazil in mid-December, but early models were manufactured in China and carried very high pricing with the iPhone 4S starting at the equivalent of over $1400. With exchange rate fluctuations that figure is now over $1500, while the cheaper 8 GB iPhone 4 still comes in at a hefty $1050. The unlocked iPhone 4 is priced at $549 in the United States.

As noted by Meio Bit [Google translation], Apple has indeed begun selling the Brazilian-made 8 GB iPhone 4 through its online store in that country, as evidenced by manufacturing information on the box and the phone itself.




Apple's online store is also now referring to the black and white models as MD128BR/A and MD198BR/A respectively, with the MD198BR number having been seen on the previously-leaked iPhone 4 from Brazil. The Chinese-made 8 GB iPhone 4 had originally launched in Brazil with MD128BZ/A and MD198BZ/A model numbers. It is not clear exactly when Apple made the transition to selling Brazilian-manufactured iPhone 4 units, but it appears to have been at least several weeks ago.

But while Apple has now transitioned to selling domestically-manufactured iPhone 4 units in Brazil, pricing has yet to come down. It is unclear whether Apple and Foxconn have yet to meet all requirements or receive certification from the Brazilian government that would make the devices exempt from the hefty import taxes or if there are other factors in play.

Notably, the iPhone 4S does not yet appear to be being manufactured in Brazil, with those devices continuing to carry "BZ" model numbers identifying them as manufactured in China for the Brazilian market. The same appears to be true of the iPhone 3GS, which is priced at the equivalent of $700. Consequently, any adjustment in pricing for the Brazilian-made iPhone 4 would create inconsistencies across the company's iPhone line there due to the significant difference in import taxes, but it is unclear how Apple and Foxconn are planning to deal with this issue.

Article Link: Apple Now Selling Brazilian-Made iPhone 4, But Pricing Remains High
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Old Feb 24, 2012, 12:24 PM   #2
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Perfect for those who really want an iPhone.
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Old Feb 24, 2012, 12:25 PM   #3
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If I take it as read that we are talking USD here, then how on earth can the normal Brazlian ever afford an iPhone?

The elite, and the fortunate will remain the only ones who can purchase one. San Paulo is a beautiful, but notorious place for high crime etc. No go areas where ( I am going back a ways ) was told that if I showed my face in I WOULD be attacked, mugged or possibly killed.

I can't see how Apple can achieve widespread sales unless they can bring down those prices.
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Old Feb 24, 2012, 12:28 PM   #4
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Assembled in Brazil.
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Old Feb 24, 2012, 12:39 PM   #5
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brazilian quality vs china quality
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Old Feb 24, 2012, 02:16 PM   #6
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brazilian quality vs china quality
It's the same.
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Old Feb 24, 2012, 02:23 PM   #7
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Only in Brazil...
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Old Feb 24, 2012, 01:32 PM   #8
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Old Feb 24, 2012, 01:41 PM   #9
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Holy Crap!!! $1500 for a phone! I'll never complain again about Apple prices here.

(Well, actually I will... my memory being what it is )
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Old Feb 24, 2012, 12:40 PM   #10
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Probably just a matter of weeks until the whole line is adjusted.
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Old Feb 24, 2012, 12:53 PM   #11
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Originally Posted by Macman45 View Post
If I take it as read that we are talking USD here, then how on earth can the normal Brazlian ever afford an iPhone?

The elite, and the fortunate will remain the only ones who can purchase one. San Paulo is a beautiful, but notorious place for high crime etc. No go areas where ( I am going back a ways ) was told that if I showed my face in I WOULD be attacked, mugged or possibly killed.

I can't see how Apple can achieve widespread sales unless they can bring down those prices.
The iPhone is not that affordable in the UK either. The cheapest iPhone 4S on PAYG is 500 quid. Apple has made it's fortune building premium products which by definition are targetted at wealthier customers. Given the way they're raking in the profits I can't see that changing anytime soon.

I've also read many reports of people in the US and the UK being mugged for their iPhone or iPad. Sadly it's a fact of life these days. There are many parts of the UK that I wouldn't want to go after dark, especially some of our inner city ghettos.
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Old Feb 24, 2012, 12:58 PM   #12
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No matter where it's assembled, high mark up and profits for Apple, and beyond low wages for factory employees.
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Old Feb 24, 2012, 12:59 PM   #13
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I'm not following. It costs Apple $1400 to make an iPhone 4s?
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Old Feb 24, 2012, 01:00 PM   #14
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Let me know when the MD128US/A are available.
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Old Feb 24, 2012, 01:13 PM   #15
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I'm not following. It costs Apple $1400 to make an iPhone 4s?
Import taxes charged by the Brazilian government on top of the price of the phone. I used to work at Best Buy and Brazilians would fly to America to try to avoid these, but occasionally would get stopped by customs in Brazil on the way home and have to pay the import tax on their product which costs as much as the product itself.
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Old Feb 24, 2012, 01:28 PM   #16
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I'm not following. It costs Apple $1400 to make an iPhone 4s?
No, it has to do with brazilian laws and regulations that tax the ____ out of certain imports
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Old Feb 25, 2012, 04:24 PM   #17
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I'm not following. It costs Apple $1400 to make an iPhone 4s?
http://en.wikipedia.org/wiki/Tariff
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Old Feb 24, 2012, 01:03 PM   #18
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No matter where it's assembled, high mark up and profits for Apple, and beyond low wages for factory employees.
Let them eat cake.
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Old Feb 24, 2012, 12:58 PM   #19
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Where in the US can I find an unlocked iphone 4S for $549? Seems to be at least $649...
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Old Feb 24, 2012, 01:03 PM   #20
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Where in the US can I find an unlocked iphone 4S for $549? Seems to be at least $649...
It doesn't say you can...

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Originally Posted by MacRumors View Post
The unlocked iPhone 4 is priced at $549 in the United States.
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Old Feb 24, 2012, 05:38 PM   #21
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Originally Posted by Shaun, UK View Post
The iPhone is not that affordable in the UK either. The cheapest iPhone 4S on PAYG is 500 quid. Apple has made it's fortune building premium products which by definition are targetted at wealthier customers. Given the way they're raking in the profits I can't see that changing anytime soon.

I've also read many reports of people in the US and the UK being mugged for their iPhone or iPad. Sadly it's a fact of life these days. There are many parts of the UK that I wouldn't want to go after dark, especially some of our inner city ghettos.
I'm just curious, but what android smartphones are targeted at the "less fortunate?" they are roughly $200 a phone. Hell, right now you can get a free 3GS. The cost of any phone is a drop in the bucket. It's the $100/mo that gets you, and that isn't Apples doing.

You probably think the price of gas going up 50 cents a gallon is a national emergency too.

I also can't remember the last time I heard of someone being mugged for their phone. Maybe 3 years ago.
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Old Feb 24, 2012, 06:02 PM   #22
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I'm just curious, but what android smartphones are targeted at the "less fortunate?" they are roughly $200 a phone. Hell, right now you can get a free 3GS. The cost of any phone is a drop in the bucket. It's the $100/mo that gets you, and that isn't Apples doing.

You probably think the price of gas going up 50 cents a gallon is a national emergency too.

I also can't remember the last time I heard of someone being mugged for their phone. Maybe 3 years ago.
you are talking about US prices.... the 3gs in brazil can be had for a good U$500, unlocked, with a carrier, you are still going to pay around U$200.

My mbp I paid U$ 2k, its a 13'' 2011 base model.

My android phone I paid U$ 333, and its a free carrier plan android, the motorola charm. The moto razrx retails for around U$1k.

Its all quite expensive in here. I wouldnt actually be extremely annoyed on those prices if it came with a good return in terms of services per taxes
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Old Feb 24, 2012, 07:20 PM   #23
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Originally Posted by bretm View Post
I'm just curious, but what android smartphones are targeted at the "less fortunate?" they are roughly $200 a phone. Hell, right now you can get a free 3GS. The cost of any phone is a drop in the bucket. It's the $100/mo that gets you, and that isn't Apples doing.

You probably think the price of gas going up 50 cents a gallon is a national emergency too.

I also can't remember the last time I heard of someone being mugged for their phone. Maybe 3 years ago.
There is no such thing as a free iPhone - you either pay for it up front or you pay for it in instalments as part of your monthly contract. Either way you pay for it.

I agree with you - all smartphones are targeted at wealthier customers. The iPhone is not exceptional in that respect. It will be a few years before smartphones are for everyone as component costs come down.

I'm assuming you're in the US. The current price of petrol (gasoline) in the UK is approx £6.30 per gallon which is approx £10 dollars a gallon. I think you would complain if "gas" cost you $10 a gallon.

You must live in a nice area because every few weeks I read in the papers here or on websites like this of people being mugged for their iPhones. A few years ago it was people being mugged for their Nike trainers. It's not unique to Apple it's just whatever is the hot must have product at the time.
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Old Feb 24, 2012, 08:44 PM   #24
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Why are people surprised at these prices? are they silly enough to think that just because it is assembled there, it would sell at the price the rest of the world pays?

In Brazil, the world price is inflated by import tariffs. To avoid the cost of import tariffs a company can choose to do the final assembly of a product that is mostly assembled overseas in Brazil. But they can still charge what they want.

The price the manufacturer can now charge is the world price plus a margin up to the value of the tariff. It can charge up to that because an importer has to pay all of the tariff.

The price of an iphone in brazil =
  • (world price of part, cost of preliminary assembly and shipping of partially assembled iPhones)+
  • (final assembly cost in brazil)+
  • (economic rent obtained by Apple up to the cost of the tariff).

A side bonus for the manufacturer is there is no need for the producer to finally assemble the absolute latest product in Brazil until the demand curve adjusts over time. Hence at this time only iphone 4 undergoes final assembly in Brazil, with iphone 4S assembled later, possibly not until iphone 5 is on the market.

The end result of all this economic reality is that Brazilian iPhones sold in Brazil will be more profitable to Apple than imported iPhones. Brazilians with a limited budget still pay more regardless and must forego purchases of other goods (including possibly revenue generating ones) if the desire for iPhones outweighs those other products.

In the long run, tariffs are counterproductive for the Brazilian economy, but good for Apple Inc, even if the economic rent component of the price should decline over time.

In fact, depending on assembly and shipping costs differences, it might be profitable enough to sell Brazilian iPhones in other south american countries at prices lower than they are sold in Brazil.
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Old Feb 24, 2012, 01:10 PM   #25
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Originally Posted by Macman45 View Post
If I take it as read that we are talking USD here, then how on earth can the normal Brazlian ever afford an iPhone?

The elite, and the fortunate will remain the only ones who can purchase one. San Paulo is a beautiful, but notorious place for high crime etc. No go areas where ( I am going back a ways ) was told that if I showed my face in I WOULD be attacked, mugged or possibly killed.

I can't see how Apple can achieve widespread sales unless they can bring down those prices.

They can get one the same way they do here in america or over in britain.

Spend money they don't have on things they don't need to impress people they don't like.
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